What is CIBIL SCORE?
A CIBIL Score is the measurement of the credit history and is the summary of the credit history in three digit score. It is in fact the individual’s credit payment loan history, which has been in the past covering all the various types of loans. CBIL Stands for Credit Information Bureau India Limited. The most important aspect of this CIBIL is that it is the representation of the person’s credit only and does not cover the aspects like savings, investment and all kinds of deposits made.
The CIBIL Score which is provided by the CIBIL, is the oldest agency for credit score in the country and is the leading institution for CIBIL Score. However, there are three other agencies which provide credit score of the person, namely High Mark Credit Information Services, Equifax Credit Information Services Private Limited, Experian Credit Information Company, but CIBIL is most widely regarded as the most reliable source of credit score in the country. The CIBIL Score generally varies from the score of 300 to 900, where a score near to 300 is considered bad, while the higher it reaches towards 900, it is considered good and more credible.
Why it matters to the banks and NBFC?
As you may know, whenever you apply for loans, the lending agencies or banks check your CIBIL Score. Thus, it raises a question in mind, why CIBIL Score matters for the banks or NBFCs. The CIBIL Score is determined by the analysis of the complete details of your loans and its repayment records and also the track records of the credit cards usage. These details are furnished on a monthly basis by the banks and analysed. The CIBIL maintains the CIBIL Score of the every individual loan applicant. Monitoring CIBIL Score provides a control and helps banks in either approval or rejection of the loan application. Always remember that the higher is the CIBIL Score, the more are the chances of the approval of the loan application for any individual. Always keep in mind, that the CIBIL Score is the first impression of the borrower for the banks.
What is the CIBIL Score for first time borrowers?
Are you a first time borrower? A question must be looming around in your head, what is the CIBIL Score of the first time borrower. Isn’t it? For first time borrowers, the CIBIL Score can show NA or NH or even can be marked as ZERO, which is in fact not the bad thing at all. These data represent that the borrowers do not have any loan history at all or don’t have the enough of the credit history in his name. It may also be an indication that no credit activity has been done in the previous years. These scores may also represent that you don’t have a credit exposure and may have all add on credit cards. The CIBIL Score of NH, NA or Zero does not indicate that you are not eligible to get any loans and it depends entirely on the lending agencies to consider your application based on their policies. They may even reject your application, but you can opt for any other banks for lending, where you can easily be successful.
How to know your CIBIL Score
You can fetch your CIBIL Score through CIBIL, which was established in the year 2000 and is mainly responsible for maintaining the track records of the people and corporations across the country. The CIBIL Score is important for both the lending parties and the lenders and thus knowing it is very important as without a satisfactory CIBIL Score, it becomes difficult for people to take loans.
With the fast developing technology, everything is just at the click of the mouse and thus checking your CIBIL Score is just few clicks away. At CIBIL Website, you can find an on line form regarding CIBIL Score. You need is to fill in the application form with all the necessary asked details in the application form. As soon as you fill in all details, You will be redirected to the payment mode where you have to make a payment of Rs. 550 through Internet banking, credit or debit card. As soon as you complete the payment process, your authentication details will be asked and upon completing it, you will receive your CIBIL Score within 24 hours through mail.
For those who are not well versed with the use of the Internet and all, you have the option to get your CIBIL Score through CIBIL Office by sending a printed application to them. You need to furnish details like CIBIL Transaction ID, Photocopy of your address Proof and your identity proof to CIBIL. As soon as these details reach to CIBIL, a detailed verification is done and your CIBIL score is sent at the address mentioned in the application form.
Always remember that around 79% of the loans get approved if your CIBIL Score is more than 750. The higher is the CIBIL Score, the more are the chance of the loan approval.
One must take care of financial transactions to maintain high CIBIl Score like,
Becoming a guarantor of someone else’s loan, as it is also being considered while measuring the CIBIL Score .
Never delay your payments.
Have a limit to your cards and loans as staying within a limit can build your CIBIL Score.
Keep a balance of unsecured and secured loans as the high number of unsecured loans may adversely affect your CIBIL Score.
Always remember that the factors like Payment History, Increased Credit Limit, Loans and credit cards and unsecured loans are some of the many factors which affect your CIBIL Score. Thus keep a check on your payment history and build a good CIBIL score by paying on time as making payments late is an indication of fraud or incapability towards making payments.