CIBIL score is a 3-digit number, ranging from 300 to 900, used by lenders to determine your creditworthiness. You must maintain a high credit score all the time to get the best offer on loan or credit card. For CIBIL score calculation, certain things are considered, i.e. your payment history, credit exposure, credit type and duration, and other factors.
A CIBIL score is calculated by the TransUnion CIBIL credit bureau considering several factors, such as borrower’s payment history, exposure to credit, type and duration of credit, and other factors. Each factor has its own weightage (as mentioned below) when it comes to credit score calculation:
Also Check: HDFC CIBIL Score
Additional Reading: Experian credit score
The four common factors that are considered to calculate CIBIL score online or offline are mentioned below:
Additional Reading: Top Credit Rating Agencies in India
The ideal CIBIL score varies for different types of credits as well as borrowers. The CIBIL score requirement for secured loans is usually lesser than that for unsecured loans. Also, CIBIL score required for salaried borrowers can be lower than self-employed applicants. Below is the range of CIBIL score and its meaning:
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You can use CIBIL Calculator to calculate CIBIL score for personal loan. You can also visit the official website of CIBIL to check your CIBIL Score.
The process of calculating your CIBIL score for home loan is the same as for personal loan. You can use the credit score loan calculator available online to get a free credit score and report. You can also get the score online through CIBIL’s website or offline by sending your documents and demand draft to CIBIL’s Mumbai office via mail.
Tip: Check Credit Score before applying for a loan
The only difference between a CIBIL score and a credit score is that credit score can be provided by any of the four credit bureaus in India, but CIBIL score is provided only by TransUnion CIBIL.
A credit score in the range of 750 to 900 is the best score as it shows that the borrower has an exemplary credit history and it is easier for them to get a personal loan, home loan, credit cards and other forms of unsecured loans with such a credit score.
A CIBIL score of 600 is not considered good as it means that you have some irregularities with your previous credit repayments. Lenders may consider you a little risky to sanction a loan. However, a few banks may still consider you eligible for a loan, but you might be asked to provide a high collateral and can be charged a high interest rate.
Applicants should have a credit score of 650 or above to be eligible for SBI personal loans. An applicant with a high credit score has a better chance of getting a low rate of interest on loans and lower processing charges.
If you have ever wondered how credit bureaus in India calculate my credit score, here is the answer. Each credit bureau has its own algorithm to calculate credit scores. Credit score is calculated after considering certain factors, such as repayment history, credit utilisation, credit duration, and credit type.