What Does CIBIL stand for?
The Central Bank of India established the Credit Information Bureau (India) Ltd, popularly known as CIBIL, as a certified credit bureau. Both the CIBIL reports and scores are checked for each person. The bureau controls and generates a CIBIL score after considering a person’s clear credit information. Also, this organization offers credit report services to banks as well as other NBFCs (Non-banking financial companies). A CIBIL score is essentially a three-digit figure that ranges from 300 to 900, with 300 being the lowest score. This number also indicates a person’s credit worthiness. Better credit history and good repayment practices are associated with higher CIBIL scores. A person’s financial history of the previous six months must be included for determining a person’s CIBIL score.
Why Is Maintaining a High CIBIL Score Crucial and What Are the Benefits?
A borrower should know about cibil score and importance of cibil report as they are valuable pieces of information because they enable banks and lenders to determine if a certain person is qualified for a loan or credit. If a person has a high CIBIL score, getting loans is simple whenever they’re needed. Other justifications for keeping a high CIBIL score include the following:
- It allows you to apply for loans.
- A good credit score enables you to request a greater credit limit on your credit cards.
- It helps getting home loans at lower interest rates.
- Banks are more likely to lend you money.
- You receive a complete credit history record.
What Is the Required Minimum CIBIL Score for Home Loans?
When applying for a home loan and hastening the approval process, a minimum CIBIL score of 700 to 750 is recommended. The minimum CIBIL score required for home loans given by many financial institutions is 650; nevertheless, a score of 750 or more is preferred because it offers you the negotiation clout to get fair treatment. When applying for a loan, a candidate’s CIBIL score is a key factor in whether their application will be approved or denied. Since home loans often have 30-year payback terms, lenders will go to great lengths to ascertain your ability to repay the loan before accepting it. You can get a high-value loan with reduced interest rates if you have a high CIBIL score. Banks and NBFCs may occasionally offer you house loans at interest rates lower than the quoted rate if you’ve maintained an exceptional credit history and CIBIL score for a considerable amount of time.
3 Important Considerations for Getting a Good CIBIL Score
It is considered optimal to have a CIBIL score of 750 or higher. The maintenance of a high CIBIL score is thought to be essential. This is due to the fact that it is beneficial when applying for a loan or credit card. Maintaining a steady CIBIL score since the start of the year may help to improve the likelihood that a loan will be sanctioned quickly. It’s crucial to maintain a stable and healthy CIBIL score that’s why it is advised to check your CIBIL score regularly. In order to achieve a high CIBIL Score, remember the following:
Have Work ethic: A person’s CIBIL score is mostly influenced by how well they manage their credit card and loan repayments. So, it should be a top priority to settle all outstanding debts on schedule.
Low Credit Use Frequency: To maintain a decent CIBIL score, keep the credit record under 30%. If it is difficult to keep within the credit card’s existing limit, it is advised to purchase a card with a greater maximum limit.
Look for Diverse Array : An individual may profit from having a healthy mix of secured and unsecured debt instead of a better CIBIL score. Home loan is an example of a secured debt, while a credit card is regarded to be an unsecured debt.
Does CIBIL Offer a Free Score and Report?
Yes, there is good news for you. Nowadays, people focus more on the CIBIL score as a number than as a concept that is crucial to the expansion and improvement of the business. Some websites offer free CIBIL scores and reports to entice users to learn more about the CIBIL score. By visiting the websites that offer free CIBIL scores, making an account, and providing information such as your contact number, email address, and the necessary credentials, you can obtain your CIBIL score and CIBIL report without cost. Your CIBIL score will then be provided by the website within 72 hours of your application. Some websites will encourage you to sign up as a member in order to receive a free CIBIL report and score, but there’s a caveat: You can only receive a CIBIL Score for free once per year. After that, you will need to pay, in order to get your score.
How Do You Obtain Your Complimentary CIBIL Score?
Here’s how to obtain a free credit report.
To obtain a free credit report, visit to the CIBIL official website and create a CIBIL account by signing up. A form must be completed.
Fill out the form with the information listed below so that CIBIL can verify your identity and background:
- The birth date
- Permanent residence or postal address
- Identification Number. A passport or PAN, or AADHAR card number.
- Before accepting, carefully read the terms and conditions.
Your Credit Information Report (CIR) will be made available to you by CIBIL when you agree to the terms and conditions, within 72 hours.
You are only eligible for a free CIBIL score once per year. You must pay Rs 550 /- to find out your CIBIL score and obtain your CIBIL report if you need it more than once per year. There are a few more premium subscriptions plans available as well, which you can select based on your convenience, in order to have access to your CIBIL score and reports, at a lower cost, for the same year.