Most banks and financial institutions would like a probable credit loan applicant with a score of at least 750. So with a score of 550 points it would be difficult to get a loan. But you can always increase your score, the first step to increasing your score would be to study your credit report thoroughly. Find out the reasons for your score being low, it could be errors from administrative perspective, or payments of late nature, or even your credit utilization rate being high.
If you are having any trouble understanding the credit report and require help with how to analyse it you could always ask a professional to help you. Firstly you need to know what are the criterias that actually are in our credit report, CIBIL will check your Repayment History (35%), Credit Utilization (30%), Mixture of credit (10%) Duration of Credit Servicing (15%), Credit Inquiries made (10%).
Keeping a check on your Repayment History, by paying all your cards, EMIs, on time and clearing them in a timely manner. Gives you a perfect score in this criteria. Also, having a credit utilization ratio that is high is very risky and will cause your credit score to fall. Considering to reduce your liabilities will help you with keeping this in check as well. Have a mixture of credit like auto loans, personal loan, credit cards, help you in improving your score as well. The duration of your loan or credit servicing will increase your score by keep a check on your payments in a timely manner. Also limiting your credit inquires affects your credit score, if it’s applying for a home loan or even a credit card, limiting your number of inquires gives you a much healthier score. When you have a low score, it also increases and impacts the interest rates banks are willing to provide you. The rate of interest depends on your score, from a score of anywhere between 760-850 you can hope to get an interest rate of 3.9%; if you have a score of 700-759 you can expect a interest rate of 4.1%; with a score of 620-699 the interest rate can rage anyway between 5.5% - 4.3%.
Read More on CIBIL
- How to Check CIBIL Score
- How to Improve CIBIL Score
- How Credit Information is important
- FAQs : CIBIL / Credit Score
- CIBIL Score -1
- CIBIL Score Roles in Loan Application Process
- Skipping payments affects on CIBIL
- Know the factors that affect CIBIL Score
- Good habits can make good CIBIL
- Tips for good CIBIL Score
TransUnion CIBIL is one of the leading credit information companies in India. The company maintains one of the largest collections of consumer credit information in the world. CIBIL Score plays a key role in the lives of consumers. Banks and other lenders check the CIBIL Score of the applicants before approving their loan or credit card application. Consumers can visit the official website of CIBIL to check their CIBIL Score and Report.