In this guide
Updated: 28 October 2026
With a low CIBIL score, most lenders charge a higher interest rate because they see more risk. But the rate is not fixed in stone. Your salary, your job, your existing EMIs and even how you apply can change the rate you are offered. This guide explains what really decides your interest rate and practical ways to bring it down.
Quick answer: To get a lower interest rate with a low CIBIL score, show strong and regular salary credits, reduce your existing EMIs and card dues before applying, apply to one suitable lender at a time, consider a co-applicant or security if you have one, and compare offers on the total repayment amount, not just the rate. Repay one loan on time and your next loan will usually be cheaper.
What decides your interest rate
| Factor | Why it matters | What you can do |
|---|---|---|
| CIBIL score and history | Shows how you repaid before | Clear overdue amounts, fix errors in the report |
| Salary and how it is paid | Shows ability to repay | Make sure salary comes to your bank account |
| Existing EMIs (FOIR) | High EMIs mean less room for a new loan | Close small loans and card dues first |
| Job stability | Longer service means lower risk | Apply after probation if possible |
| Loan amount and tenure | Very small or very short loans cost more per month | Borrow a sensible amount over a sensible tenure |
| Security or co-applicant | Reduces the lender's risk | Gold, a car or a co-applicant with a good score can help |
7 ways to bring your rate down
1. Lower your existing EMIs first
Lenders look at how much of your salary already goes to EMIs. Closing one small loan or a card balance before applying can improve your offer.
2. Clear any overdue amount
An account that is still overdue hurts far more than an old, closed problem. Pay overdue amounts first.
3. Fix errors in your credit report
A closed loan showing as active, or a loan that is not yours, can push your rate up. Check your report free once a year; see how to check your CIBIL score for free.
4. Apply to one lender at a time
Many applications in a short time add hard enquiries and make you look desperate for credit.
5. Show all your income
Regular incentives or a second income that reaches your bank account can support a better offer.
6. Consider security or a co-applicant
A secured loan or a co-applicant with a good score lowers the lender's risk. Only do this if the co-applicant fully understands their responsibility.
7. Rebuild, then refinance
Repay your current loan on time for 6 to 12 months. With a better record you can often move to a cheaper loan. Read how to improve your CIBIL score after a default.
Compare the total cost, not only the rate
Two offers with the same rate can cost very different amounts because of processing fees, insurance and tenure. Always compare:
- Amount credited to your account after fees
- Total of all EMIs you will pay
- Annual percentage rate (APR) shown in the Key Fact Statement
- Foreclosure terms; see foreclosure charges and RBI rules
Watch out for "lowest rate" traps
An offer of a bank-level rate for a very low score, with a condition to pay a fee first, is a common fraud. Genuine lenders never collect money before disbursal. Read safe vs fake loan apps.
How Indifunds helps
Indifunds is a loan facilitator in Noida that works with lending partners. For salaried people in Delhi NCR (in-hand salary usually ₹35,000 or more), our team looks at your full profile, not only the score, and explains all charges before disbursal. Rates for low CIBIL profiles are higher than bank rates and depend on the lender and your profile; approval and terms depend on verification and the lender's final decision. Check your options on the low CIBIL personal loan page.
Frequently asked questions
Can I get a low-interest personal loan with a low CIBIL score?
Bank-level rates are rare with a low score, but a strong salary, low existing EMIs and a clean recent record can get you a noticeably better offer than average.
Does a co-applicant reduce the interest rate?
A co-applicant with a good score and income can reduce the lender's risk and may improve the offer. The co-applicant becomes equally responsible for repayment.
Is a secured loan cheaper with a low score?
Usually yes. A loan against gold, a car or property gives the lender security, so the score matters less and the rate is often lower.
How soon can I get a cheaper loan after a default?
Many borrowers see better offers after 6 to 12 months of on-time repayments and no new defaults.
What is a good way to compare two loan offers?
Compare the amount you receive and the total you repay, using the Key Fact Statement of each offer.
Check your loan eligibility
Salaried in Delhi NCR? Low CIBIL score or a past rejection? Our team will assess your profile.
Takes about 2 minutes. No upfront charges.
