Used Car Loan for a Low CIBIL Score: Lenders, Rates and How to Qualify (2026)
Yes, you can get a used car loan in India with a CIBIL score below 700. While private banks like HDFC Bank and Axis Bank usually reject applications below 700, NBFCs such as TVS Credit, Piramal Finance, Kogta Financial, and Poonawalla Fincorp approve scores between 600 and 699 at interest rates from 13.00% to 19.50% a year (Nxcar partner data, October 2026).
Nxcar Lending Desk Data: Across applications processed through Nxcar in Q3 2026, borrowers in the 650–699 CIBIL band achieved a 68% approval rate when routed directly to asset-backed NBFCs with a 20%+ down payment, compared to under 14% at private sector banks. Looking for general loan rules? Return to our main used car loan pillar page or view used car loan interest rates from all 27 lenders.
Which lenders approve a used car loan with a low CIBIL score?
| Lender | Accepted CIBIL Range | Indicative Rate Range (p.a.) | Max LTV | Best For |
|---|---|---|---|---|
| TVS Credit | 650–700 (and -1 NH) | 14.50% – 17.00% | Up to 85% | Published rate cells for 650–700 CIBIL across salaried & self-employed |
| Piramal Finance | 650–700 | 13.00% – 14.50% | Up to 85% | Lowest starting rate (13%) for sub-700 borrowers with clean banking |
| Hero FinCorp | 650–700 | 13.25% – 14.99% | Up to 85% | Mid-rate NBFC for salaried and self-employed with minor past delays |
| Poonawalla Fincorp | 650–700 | 14.00% – 16.00% | Up to 85% | Digital sanction for sub-700 applicants with strong 6-month bank credits |
| Cholamandalam (Chola) | 620–699 | 14.00% – 16.50% | Up to 85% | Tier-2/3 cities and commercial/semi-urban profiles |
| Shriram Finance | 600–699 | 14.50% – 17.50% | Up to 85% | Asset-backed underwriting for older cars and thin credit files |
| Kogta Financial | 600–675 | 16.00% – 18.00% | Up to 80% | Field-assessed cash-flow underwriting when automated scorecards decline |
| Cars24 Financial Services | 600–680 | 14.95% – 21.01% | Up to 85% | High-risk CIBIL bands with instant digital inspection-linked offers |
What a low CIBIL score costs you in rupees (₹5 lakh loan, 5 years)
| CIBIL Score Band | Typical Lender Tier | Indicative Interest Rate | Monthly EMI | Total Interest (5 yrs) | Extra Cost vs 750+ Score |
|---|---|---|---|---|---|
| 750 and above | Private bank (Axis / ICICI / IDFC First) | 10.75% | ₹10,809 | ₹1,48,540 | Baseline (₹0) |
| 700 to 749 | Bank or prime NBFC (HDFC / Bajaj / Tata) | 12.25% | ₹11,186 | ₹1,71,160 | +₹22,620 |
| 650 to 699 | Mid-rate NBFC (Piramal / Hero / TVS Credit) | 14.75% | ₹11,830 | ₹2,09,800 | +₹61,260 |
| 600 to 649 | Asset-backed NBFC (Shriram / Kogta) | 16.75% | ₹12,359 | ₹2,41,540 | +₹93,000 |
| Below 600 (with co-applicant) | Specialist NBFC (Kogta / Cars24 FS) | 18.50% | ₹12,833 | ₹2,69,980 | +₹1,21,440 |
Quick Used Car Loan EMI Calculator
Adjust loan amount, interest rate, and tenure on reducing-balance math
Estimated Monthly EMI
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How lenders read your CIBIL report for a used car loan
A CIBIL score ranges from 300 to 900, but used car lenders look beyond the three-digit number. Credit underwriters inspect four specific sections of your TransUnion CIBIL report: Days Past Due (DPD) in the last 12 months, any 'Settled' or 'Written-Off' trade lines, your unsecured credit utilisation ratio, and the number of hard enquiries in the past 90 days.
If your score is 665 because of high credit card utilisation or a single 30-day delay two years ago, prime NBFCs like Piramal Finance (from 13.00%) and Hero FinCorp (from 13.25%) regularly approve the file. However, if your score is 665 due to an active loan default or a 'Settled' personal loan within the last 12 months, you will need an asset-backed NBFC such as Shriram Finance or Kogta Financial alongside a 25% to 30% down payment.
CIBIL 650 to 699 (Sub-prime tier)
Eligible at TVS Credit (14.50%–17.00% published grid), Piramal Finance (13.00%+), Hero FinCorp (13.25%+), and Poonawalla Fincorp (14.00%+). Expect 80%–85% LTV and standard digital verification.
CIBIL 600 to 649 (Deep sub-prime tier)
Requires manual credit assessment and physical residence/office verification at Cholamandalam, Shriram Finance, or Kogta Financial. Expect 70%–75% LTV and rates between 15.50% and 18.00%.
CIBIL -1 or NH (No History)
Not a bad score — it simply means you have never held a credit card or loan. You qualify for much lower rates (11.50%–15.00%); see our dedicated First-Time Buyer guide.
The 12-month credit repair strategy: buy now, reduce interest later
If you need a car immediately for work or business and your CIBIL score is 640, taking a 5-year loan at 16.50% does not mean you must pay 16.50% for all five years. Twelve consecutive on-time NACH auto-debits on a secured car loan typically lift a 640 CIBIL score into the 710–730 band within 12 to 15 months.
Under the RBI Pre-payment Charges Directions 2025 (effective 1 January 2026), floating-rate loans to individuals for non-business purposes carry zero foreclosure penalty, and even on fixed-rate NBFC loans, refinancing or pre-paying after 12–18 months of clean repayment can cut your remaining interest burden by ₹30,000 to ₹45,000.
5 ways to get approved (and lower your rate) with a low CIBIL score
Even if your CIBIL score sits between 600 and 699 today, structuring your application properly can move you from an outright rejection to an approval — and trim 1.50 to 2.50 percentage points off your interest rate.
Increase your down payment to 25%–30% of the car's value
Lowering the loan-to-value (LTV) ratio from 85% to 70% reduces the lender's loss-given-default. At TVS Credit and Shriram Finance, a 25%–30% down payment often unlocks an automatic credit deviation for scores between 630 and 680.
Add an earning co-applicant with a 725+ CIBIL score
Adding a spouse, parent, or sibling with a clean credit bureau report and verifiable income allows the underwriter to weight the co-applicant's CIBIL score as primary, often saving 2.00 to 3.00 percentage points on the coupon rate.
Choose a popular 2 to 5 year old hatchback or compact SUV
Because a used car loan is secured by hypothecation on the vehicle's Registration Certificate (RC), NBFCs approve lower CIBIL scores far more readily when the collateral is a high-resale Maruti, Hyundai, or Tata car under 5 years old.
Keep your bank statement bounce-free for 6 full months before applying
NBFC credit officers distinguish between historical credit card delays (12+ months ago) and active cash-flow distress. Six consecutive months with zero NACH/ECS bounces and healthy average monthly balance (AMB) proves current repayment capacity.
Apply through a multi-lender desk instead of firing multiple bank applications
Every direct bank application triggers a hard CIBIL inquiry that drops your score by another 5 to 15 points. Submitting once through Nxcar matches your exact CIBIL band to a single lender whose policy grid already accepts your score.
Eligibility Checklist (Low CIBIL Score)
- Age between 21 and 65 years at loan maturity
- Minimum monthly net income of ₹18,000 (salaried) or ₹2.5 lakh annual cash inflow (self-employed)
- Zero NACH/cheque bounces in your primary bank statement over the last 3 to 6 months
- No active 'Suit Filed' or 'Wilful Defaulter' status on the CIBIL bureau report
- Minimum 15% to 30% down payment ready depending on whether your score is 650–699 or 600–649
Documents Required
- KYC & Identity
- PAN card (mandatory for bureau pull) and Aadhaar card / Voter ID / Passport for current address proof.
- Banking Proof (Critical for low CIBIL)
- Last 6 months' primary bank account statement (PDF or Account Aggregator fetch) showing regular salary or business credits and zero recent bounces.
- Income / Stability Proof
- Last 3 months' salary slips (if salaried) or GST certificate / Udyam registration / shop photo (if self-employed).
- Vehicle & Co-Applicant Documents
- Registration Certificate (RC), valid insurance copy, valuation report, and KYC + 6-month banking of co-applicant (if applicable).
Frequently Asked Questions (Low CIBIL Score)
Can I get a used car loan with a 600 CIBIL score in India?+
Yes, you can get a used car loan with a 600 CIBIL score through asset-backed NBFCs such as Shriram Finance, Kogta Financial, Cholamandalam, and Cars24 Financial Services. You will typically need a 25% to 30% down payment, a clean 6-month bank statement without recent cheque bounces, and a car under 7 years old. Indicative interest rates range from 15.50% to 19.50% p.a.
What is the minimum CIBIL score required for a used car loan at HDFC Bank or ICICI Bank?+
Private sector banks including HDFC Bank, ICICI Bank, and Axis Bank generally require a minimum CIBIL score of 700 to 720 for used car loans, unless you are an existing pre-approved salary account customer with strong banking balances. Borrowers below 700 should apply to NBFCs like TVS Credit or Piramal Finance instead.
Does TVS Credit give used car loans for a 650 CIBIL score?+
Yes. TVS Credit is one of the few lenders in India that publishes an explicit rate matrix for the 650–700 CIBIL band. In October 2026, TVS Credit charges 14.50% p.a. for salaried borrowers with a 650–700 score and income proof, and 16.00% to 17.00% p.a. for no-income-proof programs in the same CIBIL band.
Can I get a used car loan if I have a 'Settled' loan in my CIBIL report?+
Private banks automatically reject applications with a 'Settled' or 'Written-Off' status. However, NBFCs like Kogta Financial, Shriram Finance, and Cholamandalam can approve your used car loan if the settlement is more than 12–18 months old, you provide a No Objection Certificate (NOC) for the settled account, and you put down 25%–30% margin money.
Will checking my eligibility on Nxcar reduce my CIBIL score further?+
No. Checking your indicative rate and lender match on Nxcar's comparison calculator does not trigger hard inquiries across 27 banks. Once we review your profile, we route your application only to the single lender whose credit policy accepts your CIBIL band, protecting your score from multiple inquiry drops.
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