Why your personal loan request can be rejected even with a 750+ credit score? 5 reasons you should know

A credit score of 750-775 is generally considered good and can improve your chances of getting a personal loan. However, a high credit score alone can not guarantee approval as many other factors, such as existing debt and repayment capacity, are assessed by the lender during the disbursal process.

Credit bureaus such as TransUnion CIBIL assign all banking customers a credit score ranging from 300 to 900. A score below 650 signals higher credit risk, while scores above this level indicate moderate to good creditworthiness.

Borrowers can check their credit score on portals like CIBIL, CRIF, Experian, or Equifax. They can access one free credit report every year from each of the four bureaus licensed by the Reserve Bank of India (RBI).

A score of 750 or higher typically reflects a strong credit profile and a consistent repayment history. Here are some reasons why your personal loan application can be rejected despite being in the high credit-score category, according to a blog post by IDFC First Bank:

• High debt-to-income ratio: If a large portion of your monthly income goes towards existing EMIs and debt repayments, lenders may question your ability to finance a fresh loan. In such a case, even a strong credit score may not be enough to offset concerns about your repayment capacity.
• Repeated credit inquiries: Applying for multiple loans or credit cards within a short period can raise concerns among lenders about your reliance on credit. Too many inquiries can signal financial stress, potentially affecting your chances of approval despite a high credit score.

• Discrepancies in documentation: Errors in identity proofs or address details, incomplete income information and even more concerning, a mismatch between bank statements and declared income can lead to a rejection of a personal loan application.
• Unstable source of income: Banks assess a borrower's current income to assess their repayment capacity. If you don't have a fixed monthly income or switch jobs frequently, then your application can be considered risky. This is why most lenders ask for your income proof of six months, as well as bank statements for further verification.
• Existing unsecured loan exposure: A bunch of ongoing unsecured loans may lower the lender’s confidence in your credit profile, even if you repay all the instalments or EMIs on time. This indicates a higher repayment burden and may lead to a rejection.

A personal loan rejection should not be viewed as a roadblock. Instead, borrowers should focus on identifying and addressing the issues that may have led to the rejection before applying again.

By consulting certified financial advisors, understanding basic eligibility terms, improving credit habits, understanding loans on a fundamental level, managing debt responsibly, and ensuring accurate documentation, borrowers can improve their chances of securing approval in future credit-related applications.

Eshita Gain is a digital journalist at Mint, where she joined in May 2025. She writes on corporate developments, personal finance, markets, and business trends, with a focus on delivering timely and relevant stories to a broad audience. <br><br> While her core beat lies in business and finance, she is not confined to a single niche and frequently explores stories across domains, including international relations and policy developments. <br><br> She holds a postgraduate diploma in business and financial journalism by Bloomberg from the Asian College of Journalism (ACJ), Chennai. During her time there, she received rigorous training in tracking financial data, interpreting corporate filings, and reporting on business developments. She has pursued her graduation from St. Joseph’s University, Bengaluru in a multi-disciplinary course. Her majors included Journalism, International Relations, peace and conflict studies. <br><br> Eshita has previously worked in digital marketing, which enables her to write SEO friendly copies that are clear and engaging. <br><br> Her primary interest lies in breaking down complex subjects and writing clear, accessible copies that inform readers. She aims to bridge the gap between technical financial language and everyday understanding. Outside the newsroom, Eshita enjoys reading non-fiction, and exploring new places, constantly seeking fresh perspectives and stories beyond headlines.

Get Latest real-time updates

Catch all the Instant Personal Loan, Business Loan, Business News, Money news, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

HomeMoneyPersonal FinanceWhy your personal loan request can be rejected even with a 750+ credit score? 5 reasons you should know

✕

Wait for it…

Oops! Looks like you have exceeded the limit to bookmark the image. Remove some to bookmark this image.