Relation Between Personal Loan and Your CIBIL Score

Knowing how your credit score shapes loan approval can help you borrow more.

When you plan to get a personal loan, lenders first look at your CIBIL score. This score has a direct effect on your loan approval, interest rate, and even the amount you can borrow.

1. CIBIL Score Shows How Trustworthy You Are

A score over 750 means you're good to go and makes getting a loan easier.

2. Bad Score Means Higher Interest or No Loan

If your score is under 650, you might not get a loan at all or you'll pay more in interest.

3. Current Loans Change Your Score

Having lots of active loans or credit cards can lower your CIBIL score and make it harder to get new loans.

4. Paying on Time Makes Your Score Better

When you pay your EMIs and credit card bills on schedule, your credit profile gets stronger over time.

5. Loan Requests Get Recorded

Each time you ask for a personal loan, it goes on your record. Asking for too many loans in a short time can hurt your score.

Suggested Read: Check Your Credit Score for Free: A Beginner’s Guide