CIBIL:
The Credit Information Bureau (India) Limited (CIBIL) is responsible for issuing credit scores and reports to individuals as well as companies. Most major lending institutions in the country review the CIBIL score of an individual to ascertain his or her creditworthiness and loan repayment capacity. It is important to note that leading banks in India expect a loan applicant to have a credit score of 700 and above to approve his or her loan request. As a result, expert’s individuals to ensure a higher credit score to boost chances of loan getting sanctioned without any hassles.
All about CIBIL Score:
The CIBIL score, which reflects the financial health of a customer is a 3-digit number which may be anywhere between 300 to 900. Most lenders such as major financial institutions, banks and credit card companies report all pertinent details related to a borrower’s credit or financial transactions/activities such as missed payments, outstanding amount and so forth to the credit bureau. Consequently, CIBIL computes the credit score of an individual based by using various statistical tools and analysis. The credit score is, therefore, not only an indicator of the credit behavior of an applicant and his or her capacity for repayment of loans but also the possibility or likelihood of a default based on past track record. Credit scores help lenders make an informed decision on offering loans to applicants based on their credit scores. As a result, approving of loans is faster, efficient and convenient.
Personal loans and CIBIL:
In most cases, banks typically look for a CIBIL score of 700 and above to approve a personal loan application. CIBIL score therefore, plays a pivotal role in determining the approval of a personal loan request due to several reasons. Firstly, given that personal loans, more often than not, are unsecured loans which do not require any collateral, lender has to gauge the repayment capacity of an applicant. As a result, lenders invariably look for a higher CIBIL score since there are no guarantees provided on a personal loan. CIBIL score therefore, assumes greater importance in case of personal loans. Secondly, as opposed to a home loan which entails some contribution from the consumer, personal loans carry a higher risk since a lender is the sole provider of finance. An applicant must, therefore, get a copy of his or her credit report well in advance prior to applying for a personal loan. If case, an applicant finds that his or her credit score is less than 700, the credit score should be improved to ensure that the request for a loan is not rejected. It is important to note that an applicant should not apply for several loans around the same time, since it reveals a credit hungry behavior which may prove detrimental to his overall financial health and thereby, have an adverse effect on his credit score. In cases where the credit score of applicants is not very encouraging, most lenders charge higher rates of interest on personal loans. Similarly, applicants who boast of a robust credit score are charged lower rates of interest. An applicant, should therefore, understand the full implications of his or her credit score and act accordingly.
The Credit Information Bureau (India) Limited (CIBIL) is responsible for issuing credit scores and reports to individuals as well as companies. Most major lending institutions in the country review the CIBIL score of an individual to ascertain his or her creditworthiness and loan repayment capacity. It is important to note that leading banks in India expect a loan applicant to have a credit score of 700 and above to approve his or her loan request. As a result, expert’s individuals to ensure a higher credit score to boost chances of loan getting sanctioned without any hassles.
All about CIBIL Score:
The CIBIL score, which reflects the financial health of a customer is a 3-digit number which may be anywhere between 300 to 900. Most lenders such as major financial institutions, banks and credit card companies report all pertinent details related to a borrower’s credit or financial transactions/activities such as missed payments, outstanding amount and so forth to the credit bureau. Consequently, CIBIL computes the credit score of an individual based by using various statistical tools and analysis. The credit score is, therefore, not only an indicator of the credit behavior of an applicant and his or her capacity for repayment of loans but also the possibility or likelihood of a default based on past track record. Credit scores help lenders make an informed decision on offering loans to applicants based on their credit scores. As a result, approving of loans is faster, efficient and convenient.
Personal loans and CIBIL:
In most cases, banks typically look for a CIBIL score of 700 and above to approve a personal loan application. CIBIL score therefore, plays a pivotal role in determining the approval of a personal loan request due to several reasons. Firstly, given that personal loans, more often than not, are unsecured loans which do not require any collateral, lender has to gauge the repayment capacity of an applicant. As a result, lenders invariably look for a higher CIBIL score since there are no guarantees provided on a personal loan. CIBIL score therefore, assumes greater importance in case of personal loans. Secondly, as opposed to a home loan which entails some contribution from the consumer, personal loans carry a higher risk since a lender is the sole provider of finance. An applicant must, therefore, get a copy of his or her credit report well in advance prior to applying for a personal loan. If case, an applicant finds that his or her credit score is less than 700, the credit score should be improved to ensure that the request for a loan is not rejected. It is important to note that an applicant should not apply for several loans around the same time, since it reveals a credit hungry behavior which may prove detrimental to his overall financial health and thereby, have an adverse effect on his credit score. In cases where the credit score of applicants is not very encouraging, most lenders charge higher rates of interest on personal loans. Similarly, applicants who boast of a robust credit score are charged lower rates of interest. An applicant, should therefore, understand the full implications of his or her credit score and act accordingly.