CIBIL Score for Car Loan: Minimum CIBIL Score for Car Loan

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To be eligible for a car loan, you need to fulfil some specific criteria. The general eligibility criteria comprise prerequisites like a minimum age limit of the applicant, a minimum monthly salary, and a good credit history. Good credit corresponds to a good CIBIL score, which is predominantly the deciding factor for the acceptance or rejection of the application for a car loan.

Minimum CIBIL Score Required for a Car Loan

If your CIBIL score is above 600, that's good; however, if the score is 750 or above, it is considered to be more favourable. Talking about the minimum CIBIL score for a car loan, if it's above 750, there is a higher chance of your car loan application getting approved.

When there is no clearly defined minimum CIBIL score limit set for a car loan, it's always favourable to have a high credit score. This can help you get the required loan at favourable terms.

Why is CIBIL Score Important for a Car Loan

A good CIBIL score for a car loan can be very important when you are looking to take a car on loan. The CIBIL score for a car loan is essential as it affects many factors like:-

Helps determine the loan amount: The CIBIL score for a car loan is proof of your creditworthiness, and if you have a good repayment history, you can easily avail a car loan of a more significant amount, while if you have a low CIBIL score, you will face difficulty in getting the desired loan amount.

Governs the approval or rejection of the car loan application: CIBIL score for a car loan is a measure of your creditworthiness, which helps the lenders to decide whether to approve your loan application or not as it is based on your past repayment behaviour.

Determines the interest rate: If the applicant has a higher CIBIL score for a car loan, it also reflects that he can hold greater financial responsibility. Therefore, there are chances that the lender would offer you the car loan at a lower interest rate, and you would have the upper hand in negotiating the interest rate. On the contrary, a low CIBIL score for car loans generally poses a risk for the lender; this is why they raise the interest rate.

If you have a good credit score, the bank/lender provides you with better access to special offers, including benefits like low processing charges, zero down payment, etc. Whereas in case of a low credit score, your loan requests can be denied or, if approved, would attract a higher interest rate, the down payments could also be on the higher side.

How Your Credit Score Impacts Your Car Loan Eligibility

The following table shows how the CIBIL score affects your car loan approval:

CIBIL Score Range	Loan Probability
300 – 599	A score of 750 or more is believed to be ideal and can help in the instant approval of your loan application on favourable terms.
600 – 749	If your credit score falls between the 600-750 range, you are still eligible to get a car loan. However, you may be charged a higher interest rate or offered a shorter tenure.
750 – 900	It can be difficult for you to get the required loan if your credit score falls under the range of 300-599. Consider enhancing your credit score prior to applying for a car loan.

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You can easily check your CIBIL score for a car loan online. You just need to register yourself on the official website of CIBIL to check your credit score and get a credit report.

To get a car loan you should have a CIBIL score of at least 600 or above. Generally, a CIBIL score of 750+ is considered a good credit score for the seamless approval of your car loan.

There are methods to get a car loan even with a low CIBIL score. But you need to assure the lender that you possess a stable source of income. In some cases, you may also need to arrange a guarantor for your loan or go with a lower loan amount or higher interest rate.

Different banks/lenders have their own eligibility criteria. The CIBIL score reflects good credit history, and a higher income vs. debt-liability ratio are some of the significant factors the lenders consider before granting car loans.

In order to get a car loan without a CIBIL score, you need to prove your income to support the installments; for that, you may need to present records of repayments of your previous bills. The lender may also ask for collateral before approving your car loan without a CIBIL score.

In case a CIBIL defaulter wishes to get a car loan, the amount will vary based on collateral presented to the lender against the loan. Since in case you default again on the loan payment, the collateral acts as the security.