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HDFC, just like any other lender, checks applicants’ scores from the Credit Information Report (CIR) developed by CIBIL. Based on the credit score the bank decide if the applicant should be granted a loan. If the credit score is low, the bank may still grant you loan at a higher rate of interest depending on the information available on the credit report.
Let us see what a CIBIL score is and why it’s important while applying for a home loan.
CIBIL score is basically a credit score given by CIBIL to indicate a person’s creditworthiness based on past credit history. This information helps lenders to evaluate loan applications.
CIBIL or the Credit Information Bureau India Ltd. is India’s first credit information company. It is also known as the Credit Bureau. The Credit Bureau maintains records of individuals’ and companies’ credit information regarding loans and credit cards. This information is submitted to CIBIL by member banks and lenders on a monthly basis. This information is used to maintain a Credit Information Report from which a Credit Score is developed. CIBIL is licensed by the RBI and governed by Credit Information Companies (Regulation) Act of 2005.
The CIBIL score acts as the first impression of the applicant.CIBIL does not decide if the loan or credit card should be sanctioned nor can it delete any records reflected on the Credit Information Report. CIBIL is just here to help with the lenders and the applicants to take an informed decision.The CIBIL Score ranges from 300-900. It is noticed that the credit score above 750 is preferred by the loan providers.
The applicant needs to keep in mind the following while applying for loan:
The following types of loans are offered by HDFC bank:
The following types of loans are offered by HDFC bank:
Home Loan | Individuals can purchase a new or an existing home or can even construct a house by applying for a loan under this scheme. |
Home Improvement Loan (HIL) | This scheme facilitates internal and external repairs and other structural improvements, such as painting, waterproofing, roofing, plumbing, electrical works, etc. |
Home Extension Loan (HEL) | You can apply for a loan under this scheme if you want to add more space to your existing home to give comfort to your growing family. |
Special Home Loan Scheme for Agriculturists | Farmers can buy or construct houses/apartments in several cities/towns or residential areas of villages of their choice under the scheme. The eligibility is based on the agricultural land they own and the crops being cultivated. The farmland is not taken for a mortgage. |
Rural Housing Finance for Salaried and Self Employed | This scheme offers home loans for government and private sector employees to buy rural properties in residential areas. NRIs can also avail loan under the scheme to purchase rural properties. |
The below mentioned points could also be one of the reasons for home loan application rejection:
Some of the ways to improve your CIBIL score are as follows:
The minimum credit score needed for an HDFC home loan is 700.
Yes. Non-payment of loan instalments will directly affect the credit score of a person
Yes, part payment of home loan can affect a person’s credit score.
Yes, the HDFC bank allots up to 90% of home loan.
You need a CIBIL score between 720 to 750 to avail yourself of a home loan from HDFC.
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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.
Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.
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