If you have ever taken a loan or used a credit card, you already know how important your CIBIL score is. It acts like your financial report card. Lenders check it before giving you any kind of loan. Just like building trust in life, building a credit score also takes time, patience, and consistency. The type of loan you take, whether it’s a secured personal loan or an unsecured personal loan, plays a role in how fast your score improves.
Here, we will break down how repayment affects your score, what times to expect, and how meeting the right loan eligibility criteria can help you bounce back stronger than before.
Understanding the basics of CIBIL Score
Your CIBIL Score tells lenders how trustworthy you are when it comes to repayment of borrowed money.
- 750 and above – Excellent, higher chances of quick approval
- 650-749 – fair, but you may be facing higher interest rates
- Below 650 – poor, lenders may step back from approving your application
When does the score start improving?
Immediate Reflection (30–45 days) – Once you make a repayment, the lender reports it to CIBIL. Usually, it takes one to two billing cycles (about a month or two) for the score to update.
Consistent Payments Over Time – Make repayments regularly, whether it’s EMIs on loans or credit card dues. It helps your score grow steadily over 6–12 months.
Clearing Old Defaults – If you’ve had past unsettled payments, repaying them will definitely help, but your score may still take a year or more to move into a good range.
Role of secured personal loans in credit improvement
If your credit history isn’t perfect, getting approved for a new loan can be tricky. This is where secured personal loans come in. Since these loans are backed by collateral, like property, gold, or fixed deposits, lenders are more willing to approve them, even if your score isn’t great.
By responsibly repaying secured personal loans, you build a positive repayment history, which gradually reflects in your CIBIL score. For many people, this is one of the safest ways to rebuild their credit health.
Secured vs Unsecured Loans, which helps more?
With secured loans, lenders feel safer, since there is collateral backing the loan. If you repay on time, it reflects positively, and this, in turn, can lead to faster improvements in your CIBIL score. And with an unsecured personal loan, there is more risk for the lender since no collateral is involved. Timely repayment here is even more valuable. It proves you can handle credit responsibly.
This difference matters because CIBIL takes into account the kind of credit you have handled and how disciplined you have been.
Personal loan comparison and your score
If you have ever done a personal loan comparison before applying, you probably noticed how interest rates, approval criteria, and repayment terms vary. But here’s what most people don’t realise: the loan you choose also impacts how your credit score shapes up after repayment.
For example, choosing a loan with manageable EMIs increases your chances of consistent on-time repayment, which steadily improves your score. On the other hand, picking a loan with higher EMIs than you can handle may lead to delays, and delays hurt your score more than repayment helps it.
So, a smart comparison before taking the loan can make your repayment journey smoother and your credit repair faster.
Loan eligibility criteria and future borrowing
Rebuilding your credit score matters so much because it directly affects your loan eligibility criteria for future borrowing.
With a higher score,
- You will have better chances of approval
- You can settle for low interest rates
- Lenders will trust you with bigger amounts
For example, someone who has responsibly repaid secured personal loans is more likely to qualify for favourable terms on their next loan than someone who has multiple defaults.
Practical tips to speed up score improvement
While repayment is the foundation, here are some additional steps to help your score rise faster:
- Pay all bills on time – Even a single late payment can hurt.
- Limit credit utilisation – Don’t max out your credit cards; stay within 30% of your limit.
- Avoid multiple loan applications – Each application triggers a check, and too many checks lower your score.
- Diversify credit smartly – A mix of secured personal loans and unsecured ones shows you can handle different types of credit.
- Monitor your report regularly – Keep an eye on errors and get them corrected quickly.
Conclusion
Rebuilding your CIBIL score after repayment takes patience, but every step you take in the right direction counts. Whether it’s clearing secured personal loans or an unsecured personal loan, your repayment is proof that you’re serious about your financial health. Combine that with good habits, like timely bill payments, smart borrowing, and mindful credit use, and your score will steadily climb.
Don’t just wait for your credit to improve; rather, work on it consistently. Check your score often, avoid unnecessary debt, and plan wisely before your next personal loan comparison.
If you are ready to take control of your credit journey, start today, and watch how small, smart moves can open bigger financial opportunities for you tomorrow.
