What is CIBIL/ Credit Score?
CIBIL, is the first impression of the applicant in front of the lender. It is a three digit number which is calculated based on the financial history of the applicant. CIBIL score ranges from 300 – 900, with people having a higher score, more eligible to get a home loan.
Usually, a credit score in the range of 650 to 850 is considered good by the banks and will help you get a swift home loan approval. However, some lenders also offer loans to individuals in the bracket of 550-650. Anything lower than 550, will strongly curtail your chances of getting an approval.
Factors determining CIBIL Score
- Payment history
- Types of credit and loan accounts
- Guarantors of loan
- Credit history
- Opening and outstanding loan amount
Easy credit from lenders: a good score, helps in getting loans and credits from lenders easily, as it exudes confidence about your ability to repay the loan in a timely manner
Quick approval of loans: a good score states that you are a good prospect to lend money to, hence the approvals are also faster
Low interest rate credits: a good credit score can earn you lower interest rates, which will help to reduce the chunk of EMI that you need to pay, thereby lessening the financial burden.
More negotiation authority: with a good score you get a loan easily, whilst improving the prospect of negotiating for lower rate of interest.
Higher approval limits: a good score, improves your chances of a loan approval at a low rate of interest, and higher sanctioned loan amount
Easy approval for leased/rented properties: can get easy loan approval even for rented or leased properties like homes, commercial complexes, apartments on a good score
Credit card offers: if you have a good credit score, then the bank offers exciting and better offers, with higher limits, cashbacks and more privileges
It is worthy to note that, there are exceptions wherein a bank may offer you a home loan based on a good credit score, even if you are falling behind in age or income. This is something which varies from one institution to the other. Hence, make sure to have a healthy credit score before you apply for a home loan.
Learn more about your home loan eligibility here.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
Income Tax Benefits on Costs of Education under Section 80E
With the proliferation of new career opportunities, getting the right professional skills has become immensely important over the years.
Why Individual Health Insurance is a Must Buy Over Corporate Health Insurance?
It is a known fact that medical inflation is growing at twice the rate of regular inflation. While most salaried employees are entitled to health insurance provided by their employer, investing in individual health insurance, personalised to suit specific health conditions, has its merits.
What Is Trade Price In Stock Market & How Does It Work?
Also known as the market price, trade price of a commodity is the price at which it is currently selling in the market. In the context of trading, the price at which a share is being purchased or sold in the stock market at a given point of time is known as its trade price.
5 Types of Business Loan For Woman Entrepreneurs
There are now many different types of loans options in India for women wanting to explore their entrepreneurial dreams. Read this post to know 5 of the most popular options.