How a 610 credit score affects personal loan approval and what borrowers should know
A credit score of 610 is categorised as ‘fair’ and sits at the lower end of most lenders’ eligibility spectrum. While such a score is not a complete barrier to obtaining new personal loans or credit cards, it often limits access to low-interest loan offers and narrows the pool of lending institutions willing to extend credit.
Elaborating on the same, Abhishek Dev, Co-founder and CEO of Epsilon Money, says, “A credit score of 610 is considered fair, so getting a personal loan is possible—though not guaranteed. You may face higher interest rates, stricter approval requirements, or lower loan amounts compared to applicants with higher credit scores.”
Loan approval is still possible, but on tougher terms
According to leading credit bureaus, personal loans are more likely to be approved when the credit score of an applicant is over 750. As this credit score is considered reputable by lending institutions.
Still, some lending institutions and NBFCs might consider applications with credit scores between 600 and 650, provided applicants are able to meet other requirements. If approved, such loan applications come with higher interest rates and stricter repayment terms.
Understanding credit score ranges and what they mean
| Score range | Rating | Risk level | Loan chances |
|---|---|---|---|
| 300-579 | Poor | Very high | Mostly rejected |
| 580-669 | Fair | High | Limited options |
| 670-739 | Good | Moderate | Generally approved |
| 740-900 | Excellent | Low | Higher approval and better rates |
Note: Credit scores discussed above are illustrative in nature. They may vary slightly by bureau. Higher scores mean better approval chances. For complete details on a case-by-case basis, reach out to your respective credit bureau.
Hence, borrowers with a credit score of 610 may face interest rates as high as 18–24 per cent, compared to the 10–14 per cent range typically offered to those with stronger credit profiles. Additionally, shorter repayment tenures or reduced loan amounts are common trade-offs in such cases. As a prudent borrower, your focus should be on securing a personal loan on the best possible terms.
Income profile, not just credit scores, drives approval
Lending institutions are gradually adopting a more focused and holistic approach to assessing creditworthiness. Factors such as employment type, income stability, debt-to-income ratio, credit utilisation patterns, and existing financial obligations are now routinely considered alongside applicants’ credit scores. This shift is particularly evident among fintech lenders, who increasingly rely on AI-driven underwriting models.
Steps to strengthen eligibility
Applicants can improve personal loan approval chances by following the given steps diligently:
- Focus on bringing down existing unsecured debt.
- Try to ensure that you maintain a credit utilisation of less than 30 per cent.
- Check, follow up and rectify errors in your credit report promptly.
- Try to pay personal loan EMIs, credit card dues on time and set auto debit to avoid missing out.
Following up on your credit report regularly through prominent credit bureaus such as CIBIL, CRIF, and Equifax, among others, can assist you in tracking progress, spotting minute errors and mistakes early, and getting them resolved in a seamless fashion.
Therefore, a credit score of 610 makes personal loan and credit card approval more challenging, but it does not rule it out entirely. With a strong financial profile, a sensible approach, and a responsible repayment history, borrowers can still access credit, albeit likely at higher interest rates and under stricter repayment terms.
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Disclaimer: Mint has a tie-up with fintechs for providing credit; you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards and credit scores. Mint does not promote or encourage taking credit, as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
