Personal loans are highly versatile loans that help you in fulfilling your dreams. They are easy to apply, paperfree and at your fingertips. But, does it all narrow down to how creditworthy you are? Your CIBIL score clearly indicates the lender if you are a responsible borrower or not. A high credit score will amplify your chances to avail a personal loan, but a low credit score can affect your opportunity. As a loan seeker, check CIBIL score to judge your creditworthiness.
What is a Credit Score and Why Does it Matter?
Credit Information Bureau (India) Limited) or CIBIL is recorded by TransUnion CIBIL, an Indian credit bureau. Your CIBIL score is a three-digit number that is reviewed by financial institutes to judge your credit asset.
make financial decisions.
It is typically calculated by reviewing your repayment history and outstanding (current) debts. It thus indicates the lenders your financial credits and your ability to manage your credit and
With a healthy CIBIL score, which is above 750, you can apply for a personal loan with no difficulty.
Can You Get a Personal Loan with a Low Credit Score?
Applying for a personal loan with a low CIBIL score can be difficult, but you can avail the benefits despite the low score. Several financial institutions demand a record of your CIBIL score when lending you a loan. So as a loan seeker, check CIBIL score to see where you stand. With a low score, you can apply for a loan with a small amount and at a higher rate of interest.
As a borrower, you need to convince the lenders by showing your steady income thus guaranteeing your timely repayment. You can also ease the process of loan approval by offering an asset such as property or gold.
What is a Good Credit Score
Your credit score ranges from 300 to 900. Score above 750 is appreciated when applying for a loan.
- 350 – 549: Poor score, defaulted payments, financial indiscipline.
- 550 – 699: Average score, requires improvement, loan with high rate of interest.
- 700 – 749: Good score, long credit history, better rate of interest.
- 750 – 900: Excellent score, low rate of interest, timely repayment.
You Can Improve Your Credit Score
Now that you know the importance of a high CIBIL score, it is important to maintain a healthy score by making sure the following:
- Timely Repayment: Prioritize timely repayments of EMIs and credit cards bills. It reflects you as a low-risk borrower.
- Check for Errors: Review CIBIL report and check for errors. Resolve transaction errors immediately.
- Balance Your Credit Utilization: Avoid using credit cards for all transactions. Maintain the usage between 15% – 30%.
- Maintenance of history: Credit history of 6 months to 1 year is appreciated. Maintain history and avoid closing old credit accounts.
Where can You Check CIBIL Score
You can check CIBIL score for free at Finserv MARKETS here. Finserv MARKETS simplifies complex reports making them easy for you to interpret and plan your future transactions.
With a high score, you can easily apply for a personal loan and enjoy the benefits at Finserv MARKETS here. With easy-to-apply process and quick approval, aid your education, home renovation, travel, marriage, and other important life expenses.