Cibil Score 765 but Reported as a Defaulter? How to Secure a Personal Loan
It is indeed unusual to be reported as a defaulter when your Cibil score is 765. This discrepancy could be due to incorrect reporting by Cibil. It is essential to file a complaint with them to rectify the issue. This article explores the steps to take and the options available if you are in a position where you need a personal loan despite this reported default.
Understand the Reporting Issue
A Cibil score of 765 indicates a strong credit history. If you have been flagged as a defaulter, it suggests there might be errors in the Cibil database. The first course of action should be to contact Cibil and inform them of the discrepancy. Filing a complaint can help in getting the matter resolved swiftly. It may also be beneficial to seek legal assistance if the issue persists.
Your Options for a Personal Loan
Several options exist if you are a defaulter and need a personal loan. Here are the alternatives:
Non-Banking Financial Institutions (NBFCs)
NBFCs typically offer a higher degree of flexibility regarding past defaults. They consider alternative factors such as your income stability and employment status. However, be prepared for potentially higher interest rates. NBFCs are a good choice if you cannot secure a loan through traditional banking channels.
Peer-to-Peer (P2P) Lending Websites
P2P lending platforms can offer personal loans at lower interest rates compared to NBFCs. These platforms operate online and process applications quickly. The downside is that if P2P lenders perceive you as a high-risk borrower, they may reject your application. Research and compare different platforms to find the best deal.
Explain Your Circumstances
If your default was due to unforeseen circumstances such as job loss or a medical emergency, it is advisable to explain your situation to the lender. Lenders generally prefer to work with borrowers who have a genuine reason for the default, especially if it wasn't willful. Highlighting your stability, job security, or the circumstances that led to the default can help in securing a loan.
Improving Your Cibil Score
If you plan to continue looking for a personal loan in the future, improving your Cibil score is crucial. Here are some tips:
Make On-Time Payments
Ensure that all your Equated Monthly Installments (EMIs) are paid before their due dates. Setting up automatic payments can prevent missed payments and improve your credit history.
Keep Credit Utilization Low
Avoid using more than 30% of your available credit limit. High credit utilization ratios negatively impact your credit score.
Keep Old Credit Accounts Open
Do not cancel old credit cards even if you no longer use them. A good payment history on these cards can positively impact your credit score.
Dispute Inaccuracies
Regularly check your Cibil report for any inaccuracies and dispute them immediately. This can help in maintaining a clean credit history.
Additional Considerations for Cibil Defaulter List
Being registered as a defaulter on the Cibil list can deter banks and financial institutions from approving your personal loan applications. Here are some options if you need a personal loan despite this registration:
Secured Loan
If you have any assets or fixed deposits with your bank, you can explore a secured loan. This type of loan does not depend on your credit score and can be a feasible option if you have collateral to offer.
Guarantor Loan
A guarantor can significantly improve your chances of getting a personal loan. If your guarantor has an excellent credit score, the lender may be more inclined to approve your application.
Online Lending Platforms
Online lending platforms are often more flexible and willing to consider your application if you demonstrate a positive credit history and have a guarantor. They offer faster approval processes compared to traditional banks.
By taking proactive steps to improve your financial situation and understand the options available, you can increase your chances of securing a personal loan.