CIBIL Score is a person’s credit score. It can be described as a 3 digit numeric representation of any individual’s credit history. Credit Report or CIBIL Score is based on the consumer’s past credit report mainly borrowing & repayment history shared by banks & lenders with SCIBIL on a regular basis. CIBIL score ranges from 300-900.
The closer the score to 900, the more chances of any Consumer of getting his loan application approved. Actually, the CIBIL score acts as a reflection of the Consumer’s past repayment history, on the basis of which the banks or lenders judge the future of the consumer’s payment.
The CIBIL score is based on 36 months of the credit history of the consumer. Many factors affect CIBIL Score including monthly income, payment history credit mix of secured & unsecured loans, inquiries & credit utilization. It is always advised to keep a check on your CIBIL Score so you are always ready for credit in case you need it the most. In Short, the CIBIL score or credit score is basically a reflection of any individual’s financial health.
The minimum CIBIL Score which is required for personal loans lies between 720 – 750. If your Credit score lies in this range, the banks or lenders will approve your loan quickly at normal interest. The CIBIL Score can be -1 also in case no information about the Consumer’s Credit history. In spite of having – I score, Still, you can get a loan by explaining how & why you are the eligible candidate by submitting your income proofs, a letter from your employer, etc. Once you get your loan, then it becomes your responsibility to pay it off on time, which eventually will increase your credit score.
Just as in our Childhood, our report Cards used to be very important, likewise now out credit Score holds the same place.
Let us discuss some points where CIBIL Score holds a very important place
- Loan Approval:- It has been discussed previously that the CIBIL Score reflects the creditworthiness of a consumer & after seeing a good credit score of an individual, the lender will never hesitate for even a second to grant the loan.
- Approval of Credit card: – Lower credit Score can reject your application of credit or CIBIL Score
- Strong Bargaining Tool: – A highly eligible consumer is always welcomed by a lender. So if you have a good credit score along with other parameters such as good income & credit history, repayment track then you can always bargain on various charges involved in the Sanctioning of home loan procedures.
- Negotiation on interest rates: – A good CIBIL Score can help the applicants to fetch the lowest interest rates on home loans.
- Better home loan Insurance: – A higher credit score can also help the applicant to have home loan insurance products at low premiums.