CIBIL score check is one of the first things lenders do when someone approaches them for a loan. CIBIL score helps them evaluate if the applicant has good credit behavior or has a bad reputation for not paying back the money they owe, this insight helps them in their decision making.
You, as an individual, have total control over your credit score. Therefore, it’s important that you do a free CIBIL score check on a regular basis to ensure everything is in order.
How Does a High CIBIL Score Affect Your Personal Loan Eligibility?
CIBIL scores are three-digit numbers that range from 300 to 900. This score indicates a person’s repayment capability. An ideal credit score is somewhere between 750 to 900. People who have credit scores in this range can get an instant personal loan or any other type of credit.
Benefits of Having a High CIBIL Score for Personal Loan Applications
Here are some of the benefits that you can enjoy if you have a high CIBIL score:
• Pre-Approved Loan Offers: Banks and other financial organizations may have pre-approved loan offers for you when you maintain an excellent credit score. With just a few documents, you can get the loans approved.
• Quick Approvals of Personal Loans: You can quickly get a personal loan if you have a fantastic CIBIL score. Lenders, banks or other financial institutions take very little time to process your request and approve your loan. If you want to improve your score, you should first check CIBIL score by pan card.
It would be best to use tools such as the CIBIL score calculator to understand your score to get a loan approval of a specific amount and then work on those goals.
• Negotiate the Interest Rates: Lenders are more inclined to listen to you when you have an outstanding credit score. They are not ready to do the same with people who have a poor CIBIL credit score. A high CIBIL score puts you in a better position to negotiate interest rates and get the best deal.
Factors Affecting CIBIL Score
Here are some factors that influence your CIBIL score:
• Repayment of Loans: If you have taken any loan or have many credit cards, make sure you pay the dues before the due date. Late payments and defaults can cause your CIBIL credit score to dip beyond your imagination.
• Age of Credit History: If you have many years of credit history, it’s an indication of how good you are with your credit and repayments. This gives a fair idea to lenders of how responsible you are as a borrower.
Do’s & Don’ts to Maintain a Good CIBIL Score
|Pay credit card bills and loan EMIs on time||Don’t settle or default on your credit card bills|
|Always borrow money that you can easily repay||Avoid taking loans from multiple lenders or plan on getting numerous credit cards|
|Checking your CIBIL score frequently is important to ensure good credit health||Don’t take your credit utilization ratio is above 30%|
|Ensure that you have a proper mix of secured and unsecured debts||Don’t close or open bank loans and credit cards without a strong reason|
Check your CIBIL score for Free
There are countless resources and tools that allow you to check your credit score. Check CIBIL score for free here.
A CIBIL credit score is crucial to get instant personal loans and enjoy many incredible benefits. It’s important that you keep montorin your CIBIL score; if the CIBIL score is low, take steps to improve it. And if the credit score is high, maintain it by practicing good financial habits.