By Nidhi Sharma
TransUnion CIBIL Limited (Formerly Credit Information Bureau India Limited) is the most popular credit information company in India and one of the four credit information companies authorized by the Reserve Bank of India. The CIBIL score is a 3 digit numeric status of your credit health summarised by your credit history, rating, and report. The score is displayed in the range of 300-900. A CIBIL score check denotes your creditworthiness and higher your score, the better are your chances of loan approval at preferential interest rates. A personal loan is an of unsecured loan that is for a short or medium-term period. It can be taken for several reasons such as a for a vacation, paying off debt, medical expenses, and wedding expenses, among others.
The RBI allows CIBIL to keep track of all your borrowing and prepayment conditioning with banks, credit card companies and other registered lenders. CIBIL also tracks whether you’re making timely disbursements or missing the due dates; the quantum of credit you’re exercising out of your credit limit; and whether you have increased your credit card’s limit. Also, it maintains a record of your loans or credit card operations in the recent history.
All these criteria and parameters impact your credit score and the minimal CIBIL score for loan eligibility. A good credit score should be in the range of 750-900 but lenders may consider you loan good indeed if your credit score is in the range of 650-700, handed you fulfill many other conditions. For illustration, if you have a stable job, enjoy home, and have no negative credit history, you may get a loan without meeting the minimal CIBIL score for particular loan.
Lenders prefer someone with a minimal CIBIL score for a loan of 700 and when it comes to the minimal CIBIL score for a particular loan, a score of 750 is preferred since a personal loan is a relaxed loan. Some banks may offer you a personal loan if your CIBIL credit score is below 750, handed you have no negative credit history. Lenders consider credit history as negative if you haven’t made timely disbursements in the once or defaulted on loans or credit card payments.
Credit Scores between 300-599
A credit score from 300 to 599 is viewed as poor by any lender. It shows the terrible record of the candidate and the non-feasibility of the payment. Thus, most lenders will dismiss the individual’s request for a personal loan. Such candidates should go to lengths to work on his/her financial assessment to gain admittance to loans or credit cards.
Credit Scores between 600-749
A financial assessment going from 600 to 749 is viewed as low however not generally so unsafe as referenced previously. There are numerous banks that might decide to disregard this score and give individual advances to the candidate in light of different variables like,
Sound reimbursement limit of the candidate
Confirmation of pay presented by the candidate
Credit against any security or insurance
Relationship with the bank
Regardless of whether you’ve conceded a loan, the rate of interest on it will be higher and the credit terms may not be great for the borrower.
Credit Scores over 750
Anything north of 750 is viewed as great by every moneylender for personal loans. The candidate can likewise get different benefits with a decent financial assessment like better loan costs, higher advance sum, higher residency, lower handling charges, and so forth.