1. How does CIBIL score impact your borrowing

How does CIBIL score impact your borrowing

CIBIL (Credit Information Bureau India Limited) is credit information company in India, that gathers financial data for maintaining credit records.

By: | Published: April 19, 2017 5:07 PM
cibil, credit score, cibil credit score, credit score cibil, save money, money, bad credit score, good credit score, improve credit score CIBIL score principally highlights your financial picture and helps lending institutes to assess the capability of repayment.

CIBIL (Credit Information Bureau India Limited) is credit information company in India, that gathers financial data for maintaining credit records. Information is shared by partners such as banks, lenders and other financial institution. This information is evaluated by CIBIL to understand the creditworthiness of a person. Based on the evaluation a score ranging between 300 and 900 is derived, that fundamentally signifies the credit history of an individual.

So when you are planning to take a Personal Loan or a home loan it is advised to get your CIBIL score checked. Your CIBIL score principally highlights your financial picture and helps lending institutes to assess the capability of repayment.  A person with good credit score, at times, enjoys the benefit of a cheaper interest rate on Personal Loan. But, if the credit score is less than a minimum benchmark set by the lender, the application is rejected immediately.

You may also watch:

Generally, a person with a credit score of 750 and above is considered to be a good borrower. Also, a score below 600 reflects that a person has defaulted on payments in past. However, different lenders have a different definition of good credit score. Hence, it is very important to maintain your CIBIL score for getting any kind of loan.

How to improve your credit score

-You can follow few simple steps to improve your credit score. Repayment of credit card spends
-To improve your score, repay your balances and try to keep them low at all point of time
-Even if you clear the full balance every month but your utilization is higher the credit score might be impacted. Hence, you need to keep the necessary checks and balances on the spends
-Also, some of the lenders assess you through the balance reported to the bureau, so it becomes necessary for you to keep the spending in limit

Pay your EMIs and bills on time

-Set reminders to pay your credit card bill because even one single default can impact your CIBIL score
-Make necessary arrangements to pay your all you EMIs on time Servicing Debt
-Taking loan for a longer period and paying your EMI’s on time has a positive impact on your credit score
-Paying debt on time for a longer duration builds the repayment history stronger and better Frequent requirement of new credit
-Lenders check your CIBIL score every time you apply for a new loan
-Reducing the frequency of new loan application will help in maintaining the credit score

Healthy mix of credit

-Timely servicing a mix of secured and unsecured loan will help in improving your financial history
-A mix of Personal Loan and mortgage loan is a healthy mix and if it’s paid off timely your credit score recovers and improves considerably.

However, you may opt for a personal loan for debt consolidation as the process of getting a personal loan is much easier. To understand the monthly outgo towards your total loan amount you may use debt consolidation calculator offered by Bajaj Finserv.

You may also watch:

Bajaj Finserv, India’s most diversified financial company, through its lending arm Bajaj Finance disburses the loan within 72 hours based on details filled by the applicant on their website. The company runs a quick background check and if it meets all the criteria’s the loan application is approved instantly. Bajaj Finserv, in its current scheme, is offering Tanishq vouchers worth Rs.10,000, for a loan amount above 10lakhs. The offer is valid between 17th to 23rd April 2017.

  1. S
    Sampathraghavan Srinivasan
    Aug 10, 2017 at 12:16 pm
    when my son's educational loan ws rejected I obtained details from CIBIL found a number of entries (defaulted,closed but not mine) not pertaining to me.God knows how such entries are reflecting in my account.I have never missed an EMI nor bounced a cheque nor defaulted a loan payment in my life.For a person who takes pride in self integrity and financial descipline ,the CIBIL record has created quite bit of embarassment and mental agony.CIBIL tells me to cotact individual ins utions for taking correctives.It is a mammoth task following up with ins utions individually.Already we are under so much of time pressure living our everyday life.It is likely that the poor score of mine will continue haunt me for a long time to come before all the unrelated entries get delinked from my account.Sorry state of affairs.
    Reply
    1. S
      sankar
      May 30, 2017 at 6:11 pm
      Nice
      Reply
      1. S
        sanjay chaturvedi
        May 30, 2017 at 3:37 pm
        Sanja
        Reply
        1. S
          sanjay chaturvedi
          May 30, 2017 at 3:36 pm
          My civil score
          Reply
          1. P
            Prasanna
            Apr 19, 2017 at 9:38 pm
            This cibil is a fraud... Accounts which are not yours also will appear in that and you will have to suffer a lot because of that... Cibil will not try to correct their mistake... Service is very poor.. need to ban this credit bureau in India...
            Reply
            1. A
              Ashok Goyal
              Apr 20, 2017 at 1:30 pm
              @Prasanna, Meet the CiBIL consultants at s: www.xpertconsultants for removal of strangers loan accounts from CIBIL
              Reply
            2. Load More Comments

            Go to Top