Is 600 a Good CIBIL Score for Personal Loans? All You Need to Know

Reviewed by: Mohit Sharma

  • Updated on: 1 Feb 2024
  • Published on: 8 Jan 2024
Is 600 a Good CIBIL Score for Personal Loans? All You Need to Know

Want to apply for a personal loan with a CIBIL score of 600? Know that it can be challenging as most lenders prefer a higher score. Your score represents your creditworthiness, and therefore, holds great significance for your eligibility. Here’s a tabulated overview of what the score implies:

Credit ScoreMeaning
800 – 900Excellent
750 – 799Very good
650 – 749Good
550 – 649Fair
300 – 549Poor
NA/NHNot Applicable / No History

As you can see, if your score is low such as 600, it doesn’t fall under the category of a ‘good’, making getting a favourable offer difficult. Nonetheless, there are a few tips you can try to secure the funds you need. Read on to know more.

Points to Consider When Applying for Loans with a Credit Score of 600

Here are some disadvantages you need to know: 

Sanction to a Smaller Loan

One of the essential criteria to remember is that the lender may offer a significantly smaller loan amount if you have a low score. After all, lenders don’t want to compromise on the safety factor. Worry not, as the following tips can help you get loan approval:

  • Show your repayment capacity with a good stable income 
  • Apply with a lender who accepts your score 
  • Improve your score before applying

Increased Borrowing Costs

If you have a credit score of 600, personal loans interest rates will be higher. Interest rates form a crucial component of your overall loan costs. Higher rates translate to a higher interest outgo. 

Here are a few factors affecting your loan interest rates, apart from your credit score:

  • Your income
  • Your repayment history
  • Debt-to-income ratio
  • Relationship with your lender

Strict Loan Terms

When you have a low score, you become a high-risk borrower. To offset this risk, your loan terms will be rigid. For instance, you may have to bear:

  • Shorter tenure
  • Higher fees and other processing charges
  • Increased rate of interest

Also Read: Know what your credit score says about you

How to Get Loans with a Credit Score of 600

Check out these easy-to-follow tips:

Show Higher Income

Lenders need to understand how you plan to repay your loan. A higher income translates to a better chance of loan approval. So, remember to disclose all income sources especially when applying for personal loans with a CIBIL score of 600 or lower. 

Opt for a Secured Loan

Here’s all you need to know about a secured loan:

  • You need to pledge your valuable assets as collateral
  • You can get lower interest rates as you’re pledging your asset as security
  • The risk factor for the lender is comparatively lower
  • In the case of defaults, the lender has the right to seize your assets
  • You can get easy approval if you go for a secured form of credit, especially with a score of 600

So, your score doesn’t have the same weightage, making secured loans accessible even with low scores. 

Apply with Another Individual

In co-applications, the lender will consider the scores of all applicants. Given this, if all of you have a good average, you can get the funds you need. For this, you need to ensure that the other person has the ideal credit profile.

So, if you want personal loans with a CIBIL score of 600, try submitting the application with:

  • Your spouse
  • Your parents
  • Your siblings

Increase Your Creditworthiness

Getting loans with a low score has certain disadvantages. But you can tackle them by improving your score with the following tips: 

  • Make timely payments of your EMIs and credit card bills
  • Reduce your existing debt to keep your credit utilisation ratio under 30%
  • Check your credit score and report periodically
  • Don’t apply frequently to avoid the impact of multiple hard inquiries
  • Maintain a healthy mix of unsecured and secured loans 

Know that building a good score requires a lot of discipline and patience. So, if you need urgent funds, this may not be an ideal option. In such instances, you can get an Personal Loan from Fibe. We have an alternate credit scoring system that allows you to get instant funding with a low or no credit score. 

You can get up to ₹5 lakhs at affordable interest rates and tenures going up to 36 months. You also get instant access to funds thanks to a 100% digital application process and minimum paperwork. Download our Personal Loan App or register on the website to apply! 

FAQs on Personal Loans with a CIBIL Score of 600

Is it possible to get a personal loan with a credit score of 600?

Yes, you can get credit. However, the lender may levy higher interest rates and you may have to meet certain criteria such as:

  • Pledging collateral
  • Applying with a co-applicant

Is 600 a good CIBIL score?

Ideally, you should have a score between 650 and 750. However, this parameter may vary across lenders. So, check and compare the requirements before you apply. 

How can I improve my CIBIL score from 600 to 800?

Try some of these easy tips:

  • Reviewing your credits core periodically
  • Maintaining a healthy credit mix
  • Keeping the debt-to-income ratio low 
  • Repaying all dues on time 
  • Lowering credit utilisation ratio

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