How Can My CIBIL Score Help Me in Availing Credit?

CIBIL score is a three-digit numeric number that determines your creditworthiness as a borrower. There are several credit rating agencies in India that keep track of all your transactions related to credit cards or any other kind of loan facility. TransUnion CIBIL Limited is one such credit rating agency that gives you your credit score. If you have ever come across the question such as how can my CIBIL score help in getting a personal loan or home loan and want to know the answer for it, then this article would be perfect for you as we will be telling about this thing in detail.

What is the Importance of CIBIL Score for an Individual?

CIBIL score range from a score of 300 to 900. The more you are closer to a score of 900, the lenders will find you more suitable for giving a credit facility. A score of 700 or above is considered to be a good score. And similarly, the more you are neared to the score of 300, the lenders will see you not fit for a credit facility. CIBIL score is directly connected with your repayment behavior. A good credit score shows that you are able to handle the debt in a better way than a person with a poor credit score.

When you will have a good credit score, the lenders know that you will be able to pay the credit within the due time. It is easier for them to trust upon you as compared to an individual who has been not having a great repayment history. So you can understand it yourself if you were to give a loan and you were to choose between two people of which one of them as a bad reputation and one of them always paid his debt on time, who would you choose? Obviously, the person with a good repayment track. The same is with the lenders also becasue they always look to minimize the risk factor in the money they are giving. So if a person says that my CIBIL score is 730, the lenders will give them loan instantly, and that too at a lower rate of interest.

How can you check your CIBIL score?

If you want to check your credit score, you can go to the official website of CIBIL and by filling a few details such as your name, phone number, email id, etc. By filling them, you will be registered with the CIBIL. After the registration, you will have to perform the CIBIL score login process to get your credit report on your registered email id. 

What are the reasons behind your credit score getting a dip?

Missed Payments: If you have a loan or credit card in your name and do not pay the EMIs (Monthly Installments) on time, your credit score is bound to take a hit. One or two late payments don’t affect that much, but if you make a habit of it, then it can be harmful to your credit score. You should always pay your dues on time to improve your credit score.

Spending beyond Limit: A lot of credit card users forget their repayment capability while spending that hurts them while making the repayment. And then they say that my CIBIL score is too low.  Always spend what you can repay, that too within the due date. 

Credit Limit Utilization: A lot of customers have this habit of exhausting their limits regularly. This habit will show you as a credit hungry borrower to the lenders and they will not deem you as a fit for credit. Spend only 30%-40% of your total credit card limit. 

Multiple Credit Enquiries: If you make multiple loan inquiries within a short span of time, your credit score will be impacted by it. Always keep a substantial gap between two loan inquiries.