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While a low CIBIL score can make it harder to secure an education loan, approval is still possible under certain conditions. Lenders may impose stricter terms such as higher interest rates, reduced loan amounts, or additional documentation.
However, applying with a co-applicant who has a strong credit score or offering collateral can help strengthen your application. It is strongly recommended to monitor your credit score regularly and review your credit report for any discrepancies.
Improving your credit score over time not only increases your chances of loan approval but also helps you secure better terms. You can check your credit score or begin your credit improvement journey through Bajaj Markets.
A CIBIL score of 700 or above is generally considered good for obtaining an education loan with ease. It indicates that the borrower or co-applicant has a strong credit history. A score below 700 may lead the lender to request additional security, such as a co-applicant or collateral.
A higher score increases the chances of quick approval and more favourable loan terms. Financial institutions also assess the repayment capacity, academic course, and institution reputation during evaluation. Maintaining financial discipline and clearing existing dues can help strengthen the credit profile.
There are several ways to get an education loan with a low CIBIL score. Below are some effective options to secure a loan despite a poor credit history.
You can get a loan by offering an asset such as property or a fixed deposit. This acts as collateral and increases the bank's confidence, even with a low score.
Request a parent or guardian with a strong credit score to co-sign the loan. Their good credit history can support your application.
Schemes like the Central Sector Interest Subsidy (CSIS) support students from low-income families. These help in getting loans despite a low credit score.
Highlight academic performance, admission to a reputed college, or future earning potential. These factors can strengthen your loan application.
Several Non-banking Financial Companies (NBFCs) offer education loans with flexible terms. These are often easier to get with a low CIBIL score.
Improving your credit score can make it easier to secure an education loan. Always pay bills and EMIs on time. Keep credit card usage low, preferably below 30 per cent of the approved limit. Review your credit report regularly to identify and correct any errors.
Maintain a balanced mix of secured and unsecured credit. Avoid making multiple loan or credit card applications within a short period. Keep older credit accounts active to show a longer credit history.
When a low credit score prevents access to a regular student loan, several alternative options exist to fund your education:
These are awarded based on academic performance, family income, or social background. They do not depend on a credit score.
Many colleges provide financial support through fee waivers or merit-based scholarships. Some also offer part-time employment opportunities on campus.
Financial assistance from family members or the use of personal savings can reduce dependence on loans. This also eliminates the burden of interest payments.
These long-term investment schemes are specifically designed for education. They do not involve any credit verification process.
Such programmes provide low-cost training and resources. They are often more accessible for individuals with low credit scores.
Private organisations cover educational expenses initially. Repayment begins later as a fixed percentage of future income.
You can still get an education loan with a low or bad CIBIL score
Applying with a co-applicant or guarantor improves your chances
Collateral-based loans are easier to get as they reduce the lender’s risk
A CIBIL score of 700+ is preferred, but lower scores can work with extra security
NBFCs may offer loans with flexible terms
Government schemes like CSIS help students from low-income backgrounds
You can also explore scholarships, savings, part-time work, or ISAs as alternatives
Improving your credit score by paying on time and keeping credit utilisation ratio low can help
Visit Bajaj Markets or the lender’s website. Enter details like your course, institution, income, and academic record to check eligibility.
Yes, many lenders offer an education loan with a low credit score. You can apply with a co-applicant, provide collateral, or choose a government-backed scheme.
A score of 700 or above is usually preferred. You can still get a loan with a lower score by applying with a co-applicant or offering security.
Approval usually takes 7 or more working days. It depends on the lender and how quickly you submit all documents.
Check the reason for rejection. Improve your credit score or apply with a co-applicant or under a government scheme to increase approval chances.
Yes, most banks allow prepayment. Floating interest rate loans usually do not carry a prepayment penalty.
The following documents are required for an education loan:
Duly filled application form
Bank statements
Academic documents
Proof of admission
ID and address proof like Aadhaar, PAN, passport
Passport-size photographs
Collateral documents (if applying for a secured loan)
Yes, some private lenders offer loans to students with bad credit. A co-applicant with good credit improves your chances.
You can explore scholarships or part-time jobs to fund your education. Family support, peer-to-peer lending, and Income Share Agreements (ISAs) are also helpful options.
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