When it comes to banking, money lending, debt management, etc., the CIBIL score plays a vital role and individuals’ creditworthiness and repayment behaviour is judged based on the CIBIL score. Therefore, an individual is required to maintain his CIBIL score, which is managed on the basis of the repayment, debt amount, history, etc. A CIBIL score plays a vital role in issuing money and credit card. Therefore, an individual must have the proper knowledge of the CIBIL score.
What is a CIBIL score?
CIBIL score is considered a three-digit summary used to display the credit score and the credit behaviour of the individual. A CIBIL Score is the direct reflection of the credit worthiness of any individual, or the most common term used for them is the borrower. The higher the score is, the more potential the individual holes. The overall CIBIL score is dependent upon the debt amount, repayment history as well as a credit of an individual, based on which the CIBIL score is ranged between 300 to 900. This helps an individual to quickly issue a personal loan from the bank as well as it is also helpful in giving a credit card and personal loan.
Importance of a CIBIL score:
Having a good CIBIL score is quite essential when it comes to financial and bank activities because a CIBIL score is the proper reflection of the integral role of an individual in the financial market as well as its creditworthiness. Therefore, any bank, worker or lender will decide your worthiness on the basis of the CIBIL score. Moreover, a CIBIL score also significantly affects the loan application processing time repayment, tenure, credit offered, interest rates, and down payment amounts. A high CIBIL score will help an individual get a loan at low-interest rates compared to those with a low CIBIL score.
Issuing load in case of a bad CIBIL score:
In case of a bad CIBIL score individual can also issue a loan, but there are several terms and conditions and some guidelines that need to be followed. Some of the basic steps that need to be considered while issuing a personal loan with a bad CIBIL score are:
- Individuals must provide the proper evidence of their income to show the loan repayment.
- An individual can issue a low personal loan amount based on this CIBIL score.
- Moreover, an individual needs to have a joint loan or a guarantee.
- If there is any error in the credit report that is lowering the CIBIL score, that needs to be improved, and mistakes need to be rectified.
Having a good CIBIL score gives an excellent advantage to the individual. An individual with a higher CIBIL score enjoys various pros, including less interest rate, high credit amount, etc. It is pretty crucial for an individual to maintain a CIBIL score. Some of the important ways to improve the CIBIL score include regular payments, preventing default of the loan EMI, closing the credit cards which are not in use as well as do not spend the loan application for a short period. View more About Personal Loan