Has your loan been declined, the agent states that your CIBIL score is too low. You are wondering which exam is this, which should have a passing mark. But there is no need to panic, we will tell you what the CIBIL score is and how the numbers are brought to maximum.
The CIBIL score is your life-long financial test, the better your marks, the better the chances of getting a new loan or credit card. In this exam, you are given numbers on your financial transactions. CIBIL (Credit Information Bureau of India Limited) is the accounting organization for all those numbers or, in other words, transactions.
CIBIL is one of the leading institutes in India to raise credit information and distribute this information to financial institutions. CIBIL maintains a credit history of over 5 crore individuals and institutions worldwide.
A credit score is generated based on this credit history known as CIBIL score
How is CIBIL Score Determined?
The following reasons are responsible for determining your CIBIL score –
Payment History: CIBIL has all the records of whether you pay EMI of credit card bill or loan on time. Whether you pay on time or pay late or do not pay at all, these things have a profound effect on your score. Payments made on time increase your score, while late payments reduce your score. .
Use of Credit Limit It is a good thing to have a higher limit on the credit card, but it is a thing to keep in mind here that this limit of the card is, in the end, only a loan. Therefore, use it responsibly. If you pay on time, future lenders will know that you are completely trustworthy.
Healthy Loan Mix: A good payment record for secured loans (home and auto) and unsecured loans (personal) helps improve your CIBIL score.
Credit History: Loans that have been running for a long time and which you have paid continuously on time. This kind of financial behavior makes your score very attractive, so pay special attention to such loans and do not miss the payment.
New Credit Card / Loan: This offer on this card, that offer on that loan, avoid this temptation and avoid taking a new card or loan unless necessary. Every time you apply for a card or loan, it affects your CIBIL score.
Suddenly, as the number of your cards or loan applications increases, lenders may also feel that you have high debt and it may be unsafe to pay a new loan.
Meaning of cibil score
Like other exams, in this economic exam, numbers are given, you are rated from zero to 900, let us tell you what the CIBIL score you get means and what your score should be for a healthy financial life. needed.
|-1 (minus 1)||If your score is -1, it means that you do not have any credit history. In this situation, even if you do not have any need, take a loan / credit card and repay it on time, in this way your credit history will be made and it will be easy to take a loan in time.|
|0 (zero)||The credit history of the borrower is available for less than 6 months. In this case also you may have difficulty in getting loan, so in this case also you can repay it by taking a small loan and create your credit history.|
|350 – 550||This kind of score should be a matter of concern for you, after seeing this score, banks understand that you are the defaulter who does not repay the loan on time. The bank will not give you any type of loan or credit card when the time comes and if you give it, then you may charge a very high rate of interest.|
|550 – 650||This score is accepted by the bank, this score tells the banks that you pay on time and you can be trusted while giving any new loan. Any loan / credit card will be passed to you without hesitation.|
|650 – 750||A score like this indicates that your financial sense is much better and that you are an ideal customer for banks. Remain on your economic senses, maybe your CIBIL score gets better.|
|750 – 900||A person or institution with such a score is considered an economic expert. We personally advise you to call your phone company to activate the Do Not Disturb feature as you are fond of banks and they will always be eager to give you new loans or cards.|
Will there be a loan if there is a score of -1 or 0?
There is no such rule or regulation that you will not be given a loan if you score -1, 0 or worse. In the end, it depends on the bank or lending institution, whether it gives you a loan or not. But of course you will have difficulty in taking a loan compared to a person with a better CIBIL score and many institutions may refuse to give you a loan.
Is a good credit score loan guaranteed?
A good credit score is necessary, but keep in mind only a good credit score is not a loan guarantee and CIBIL does not have any role in this process. It depends entirely on your chosen bank whether to give you a loan or not. , Maybe the bank can also give you a loan at a higher interest rate
How to check CIBIL score?
- If you want to know your CIBIL score, then there are two ways, first login to www.cibil.com and get your score by paying the prescribed fees.
- If you do not want to pay a fee and want to score, go to a website like Paisa.co, register and know your score for free.
Hopefully after reading this article, you –
- What is a CIBIL score?
- How is it determined? And
- Do you know it?
Must have known about If you have any questions related to CIBIL Score, then you can feel free to ask me.