What is CIBIL and CIBIL Score?
CIBIL stands or Credit Information Bureau (India) Ltd. It is the first credit information company in the country that gathers and maintains the individual’s as well as commercial entities’ records of payments related to credit cards and loans. This information is basically presented to CIBIL on a monthly basis by banks and other lenders. With the help of this information, CIBIL then creates a score known as the CIBIL Score on the basis of which lenders evaluate you and your loan applications are approved. Depending on your credit history, you will receive a CIBIL score between 300 and 900.CIBIL has a huge database of more than 17 crore consumer records and
more than 65 Lacs organization records. The website maintains the most recognized security standard in the world to ensure that such crucial information remains confidential and safe.
All banks check your CIBIL score before giving a nod to your loan application. The higher CIBIL score you have, higher are the chances that your loan will get the approval, as high score indicates that you make repayment installments on time while low scores indicate that you are careless about repaying the loan or not good for getting loan. About 80% of the loans are approved only for those who have a CIBIL score of over 750.When a bank looks at your CIBIL score, this credit score gives them a quick look at your detailed credit history so far. Thereby, reflecting your credit worthiness in the simplest form. So, it is better to not waste your time around doing all the paper work only to be rejected for the credit card, car loan, home loan or personal loan you so wanted to acquire. Simple get your CIBIL score checked first. Then go to the CIBIL Market Place. Here, one can browse and compare the customized loan deals provided by various banks on the basis of your loan eligibility.
How CIBIL Works:
Let us understand how CIBIL calculates your loan eligibility. They first summarized your past credit history in a set of score parts. These score parts are basically the numbers that reflect the information in your credit report generated by CIBIL. These include the number of late payments, average age of accounts, average credit card limit, number of inquiries, number of open installment loans, etc. After determining the information on these score parts, they are put into an equation to come up with the CIBIL credit score that is calculated with the help of a technical system. To calculate the score, the system considers roughly 10% enquiries, 15% duration of the account, 15% account types, 30% payment history and 30% credit usage. The CIBIL credit score starts around the center and depending on your further credit behavior you begin to gain or lose points. The CIBIL credit score is objective.
If you wish to use CIBIL score to help you in getting a loan approved, you must ensure that your credit usage and payment history is good. As these two parts make up 60% of your score. However, if upon checking your CIBIL loan eligibility score you find it low despite good record, it can be a matter of distress.However, if you have a bad credit score because of default in payments due to genuine financial crisis, missed payments, disputes with lender on account of fraud/ charges/ annual fees, etc. you will have to improve it to be eligible for loan. Do not run to any repair company to pay a large sum as it will not help. Thus, it is recommended to choose CIBIL’s online dispute resolution process in such cases.
How to Get Your CIBIL Score?
To get your CIBIL score, you will have to visit the official CIBIL website, CIBIL.com. There you will have to navigate to the appropriate page. There fill in all the necessary information as asked. The technical system of the website will then perform essential actions and calculations to provide you with your credit score. In order to use your CIBIL score, you will have to purchase your own report which can be done in a simple and hassle free manner.