Even as the RBI’s MPC is raising the key repo rate in order to control inflation in the country, loans for borrowers are also getting costlier. Many banks have raised their interest rates on the loans amid the tight monetary policy regime in the country. However, there’s a way the borrowers can get relatively cheaper loans — good CIBIL score.
CIBIL score is a credit score of an individual. It scales the credit discipline of the person between 300 and 900. The higher the score, the better it is. Generally, a score above 750 is considered good where the chances of loan approval become higher. The score gives an overall indication of the individual’s creditworthiness and history. Also, the CIBIL report (which has the CIBIL score as a part) reveals whether the person has ever defaulted on any repayment in the past.
Apart from easy approval of the loans, the CIBIL score also helps the borrowers get cheaper loans. For instance, on home loans, State Bank of India (SBI) offers loan rates based on the credit score of the borrower. It offers regular home loan at 8.05 per cent for those having a CIBIL score above 800, 8.15 per cent to those having a score of 750-799, 8.25 per cent to those with 700-749 CIBIL score. Those having a CIBIL score of 650-699 can get the home loan at 8.35 per cent, and those with the 550-649 score can get it at 8.55 per cent.
There are various ways to ensure loan approval, which include having stable employment, earning viable income, prior credit history, your relationship with the bank, and the most important — CIBIL score, which will help you get a loan easily and effortlessly, according to microlending platform SmartCoin CEO & co-founder Rohit Garg.
According to a report by TransUnion CIBIL, about 79 per cent of the loans are sanctioned to people who have a CIBIL score of 750 and above. Having a higher CIBIL score not only makes it easier for the applicant to get loans easily, but he also gets the loan at a relatively lower rate of interest.
How To Check CIBIL Score Online?
CIBIL provides one report a year without any charge. That can be checked online. Following are the steps through which you can check the CIBIL score:
1) Go to the official CIBIL website https://www.cibil.com/
2) Select ‘Get your CIBIL Score’
3) Click on ‘Click here’ to get your free annual CIBIL score
4) Type in your name, e-mail ID, and password. Attach an ID proof (passport number, PAN card, Aadhaar or Voter ID). Then enter your PIN code, date of birth, and also your phone number
5) Click on ‘accept and continue’
6) You will get a one-time password (OTP) on your registered mobile number. Type in the OTP and select ‘Continue’
7) Select ‘go to dashboard’ and check your credit score
8) You will be redirected to the website, myscore.cibil.com
9) Click on ‘member login’ and once you log in, you can see your CIBIL score.