CIBIL ScoreCIBIL score is characteristically a 3 digit number that summarizes one’s credit history. This is calculated using the information that prevails in the Enquiries and Accounts section of one’s CIBIL reports. This information, in most cases, pertains to one’s credit cards or loan accounts. Their payment history is taken into consideration, and so is the days past due to the outstanding amounts. The score may hence be seen as a reflection of an individual’s creditworthiness. The lower and top range of CIBIL score is 300 and 900. The higher is one’s CIBIL score, the more likely is the individual to have his loan approved. 79% of loans are approved for individuals who have a CIBIL score of over 750. One can find a loan with lower interest rates and credit cards with additional benefits. Pre-approved loans or those with a longer tenure can be availed with a greater degree of ease. Top metrics used for calculating CIBIL score:
- Payment history
Ways to keep the CIBIL score highAn individual’s CIBIL score has a direct impact on his access to credit for the future. This is even while one’s CIBIL score is based upon past payments and credit history. It goes to show that one’s actions in the present date define one’s credit footprint. Here are a few of the top tips, which help one maintain a high CIBIL score:
- It is best to pay your dues on time. Lenders see late payments negatively.
- Keeping the balances low is preferable. So one must act prudently and keep credit utilization within limits.
- Loans must ideally be a mix of secured (auto loans, home loans) and unsecured (personal loans, credit cards). Unsecured loans, taken in excess are viewed negatively.
- Practice moderation when applying for credit. Continual seeking excessive credit must be avoided.
- Keep a close watch over all your accounts, joint, co-signed and monitored. You stand to be liable if payments are missed for any of the accounts. Negligence on the part of your joint account holder may reflect over your creditworthiness.
- Keep a track of your credit history, year-round. By monitoring the CIBIL score and report, one can have a better idea about his eligibility for a loan. By going through the report regularly, easy to miss discrepancies come to light.
- In case one does come across a discrepancy, one can log on to the CIBIL website and log a dispute. Alternatively, you may ask the lender to mention the correction to CIBIL.