Wondering why your loan application got rejected? Well, your CIBIL score might be the most likely reason. Because your loan approval majorly depends on your CIBIL score. Read through to learn basics about CIBIL score.
What is CIBIL score?
The credit score or CIBIL score is a three-digit numeric summary of your credit history. Based on the data available in the Credit Information Report (CIR), the score gets generated. CIR is the credit payment history of an individual across credit institutions and loan types over a period of time.
Who gives your CIBIL score?
Credit Information Bureau (India) Limited (CIBIL) keeps a tab on the credit scores. The bureau gathers and maintains all the payments of the individuals, pertaining to credit cards and loans.
The CIBIL score depends on:
- Payment history
- Number of loans
- Type of loan accounts
- Length of credit history
- Outstanding debt
- Other factors
What is a good CIBIL score?
The CIBIL score is measured within a 300 to 900 range. The score above 700-750 is considered healthy. A good CIBIL score is not just important for loan approvals but also helps in getting better interest rates and terms.
How to check your CIBIL score?
- Log on to www.cibil.com/creditscore
- Update basic details
- Update some details like previous or existing loans and payments towards credit card
- Based on the length of credit records to access, one needs to make payment and get access
Here are some tips to maintain good credit score
The best way to maintain high credit score is to:
- Avoid irregularities in repaying loans
- Do not use more than 30% credit limit
- Stop re-applying for loans if rejected
- Pay more than minimum amount
- Maintain low frequency of applications
- Do not apply for too many loans in a short time
- Keep a check on your credit score
In conclusion, CIBIL score is all about how to be clever and stay on the top of the trick. Make wise money decisions to maintain good records. For more personal finance advice, approach online advisors like ArthaYantra. Our mission is to bring high-quality financial advice affordable to everyone, irrespective of their wealth status.
