Banks usually insist on a minimum credit score for loan processing. A good credit score of 750+ is always recommended. However, if you have a lower credit score (e.g., 600+) but can offer collateral as security, it works. Better CIBIL score proves your creditworthiness and you stand a chance at getting a better deal on the loan offer. On the other hand, if you are taking your one of the first loans and do not have any credit history, timely repayment of collateral loan can help you to develop a good score.