Rakesh Mehra was elated when he received an offer letter from a major multinational company with good package. Apart from moving cities, the next thing on his plate was to buy a home. He applied for a loan that was linked to his salary account, yet the process took longer than expected. He didn’t have a credit score despite having finished his loan terms for his first home and car.
Of the most critical aspects involved in getting a loan these days, one of them includes getting a CIBIL score. As the world moves towards and idealistic solution for banks as well as for loan applicants, aspects such as having a CIBIL score will surely improve your situation towards gaining a loan. We discuss the reasons and the significance a CIBIL score can have towards securing a loan from your preferred bank.
How does one get a CIBIL score?
Although it’s critical to have all the documents in place when you begin to apply for a loan, similarly it is important to have a good CIBIL score. Yes, a credit score maintains and tracks all the data related to previous payments and defaults, if any. We list the factors based on which your credit score will be determined:
- Complete record of all payments and defaults, if any.
- Complete record of loans and credit cards held.
- Record of all payments made towards your loans and other prior credit cards
- Amount of diligence maintained towards the repayment of various credit card and loans undertaken
By accessing the CIBIL website, one can generate their own CIBIL score and access their own CIR. By creating your credit score, the bank you intend to apply for the loan will deem your creditworthiness based upon the credit score.
Why is it necessary to maintain a CIBIL score?
The Credit Information Bureau Limited score is accessible by banks and other financial institutions to receive credit. A credit information report or a CIR is created by the bureau that mentions the score. Here’s how the process works:
The credit score essentially expedites the process by evaluating all the aspects required to deem the creditworthiness of the individual applying. In the case, the number of times Rakesh Mehra has defaulted, the number of times that he has been rejected for credit will be evaluated. Such factors are assessed to derive a credit score. Most banks have a limit or a credit score range that separates defaulters from the rest.
Stay tuned to your credit score online
By creating an account online with the CIBIL website, one can regularly check their own credit score. In most cases, an acceptable credit score mentioned in the CIR or the Trans Union score ranges from 300-900 units. One can easily purchase the CIR online by paying directly to the website.
Stay updated to your credit score records and check if your information is accurate. Rectify any errors that may be present in your credit information by filling the online dispute form.
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