A good CIBIL score is crucial to ensure loan availability as well as beneficial terms and conditions on a loan. A good CIBIL score range for a loan is 750 to 900. Before applying for a loan, borrowers should apply to avail of their free CIBIL report and check their online CIBIL score. They should go ahead with the application only if their credit score is 750 or above. Here's why a good credit score is important.
A Good Credit Score Helps One Get Approved for a Loan Easily
A CIBIL score of 750 or above is a sign of a highly reliable and trustworthy borrower. Such a CIBIL score belongs to borrowers who always clear credit card payments and EMIs on time, maintain a healthy mix of different types of credit and keep their credit utilization ratio under 30%. In conclusion, such a credit score is the mark of an ideal borrower. Thus, when a borrower whose CIBIL score is above 750 applies for a loan, lenders approve their loan application quickly.
A High Credit Score Helps Borrowers Avail of Low-Interest Rates
A high CIBIL score, i.e. 750 or above also gives borrowers high negotiating power. Since lenders want such borrowers as clients, borrowers can easily negotiate for low-interest rates. When it comes to loans, even a small difference in the interest rate offered can make a huge difference to one's total interest pay-out and help one save a lot of money in the long run.
It Makes One Eligible for Better Loan Terms and Conditions
As mentioned before, a good CIBIL score gives one high negotiating power. Thus, borrowers who have a high CIBIL score can negotiate for better terms and conditions on their loan, such as longer loan tenor to make repayment easy and higher loan sanctions.
A Good CIBIL Score Also Increases One's Chances of Landing their Dream Job
Not many people know this but these days most reputed companies check a job applicant's credit score before extending them a job offer. They do so to ensure that the person they are planning to hire as an employee is reliable and will be an asset to the company. If you are someone who constantly misses EMI payments and has defaulted on loans in the past, the company may not want to hire you as an employee.
Final Words
If you are planning to apply for a home loan or any other type of loan, you must check your CIBIL score and make sure it is at least 750. If your CIBIL score is not as good as it should be, you must work on improving it. To improve your CIBIL score, make it a habit of clearing EMIs and credit card bills on time. Further, always try and pay the entire amount due on your credit card and not just the minimum amount due. This will help you maintain a low credit utilization ratio, which in turn will help you improve your credit score. Further, stay away from credit until and unless you absolutely need it and also check your credit report for errors that might be harming your credit rating.
.png)
0 Comments