How are CIBIL scores calculated?
CIBIL scores are calculated based on various factors such as one's payment history, number and type of loan accounts, length of one's credit history, outstanding debt and many other factors. On the basis of the credit score, the bank evaluates creditworthiness of loan and credit card applicants. Every bank has its own criteria of considering a credit as good or insufficient for lending to people.
Why are CIBIL scores important?
CIBIL scores are important to avail credit, and loan approvals. Your CIBIL score or credit score is looked into through CIBIL. A credit score bases your creditworthiness that will assist in receiving loans easily. It also makes the first impression on the lender; a higher score is always appreciated than a lower one.
How effective is my credit score?
Credit score is eminent for credit approvals and a higher one will give you the power to bargain on the interest rates for any borrowing. It also has a say in approval of housing be it loan or rent. CIBIL score can also get your new cell phone plan approved quickly, or crack a lesser premium for insurance.
How does my CIBIL score matter?
One of the main factors in determining eligibility to take credit card or loan is CIBIL score you have. Thus credit score matters when it comes to credit approvals from lending institutions, as the latter judges' loan repayment and eligibility you have, with the credit score assigned to you. A good credit score gives you an upper hand at negotiating loan terms and interest rates. It can be used to gain approval for housing and a new cell phone.
What does not affect your CIBIL Score?