An individual’s credit score, more commonly known as CIBIL Score (credit score calculated by CIBIL credit bureau), is a 3-digit number that represents their creditworthiness i.e., how well they can manage. To put it simply, your CIBIL score tells the lender whether you are a risky borrower i.e., whether or not you are capable and reliable of repaying the loan on time. It is one of the major factors that lenders look in to when going through loan applications. The CIBIL score is calculated on a scale of 300 to 900. The higher the score, the better your chances of getting the loan approved for new credit.
Steps to Check Your CIBIL Score For FREE Online
With the availability of online tools and financial instruments, checking credit score online for free in India has become very easy. This score is crucial for getting a Housing Loan approved at a favorable interest rate.
Applicants can check free credit score by following these simple steps:
- Choose a lender and go to their official website.
- Click on the 'Get Your CIBIL Score' button on the homepage.
- You will be redirected to a new page where you need to fill in your personal details such as name, date of birth, gender, and contact information.
- Once you have entered your personal details, click on the 'Submit' button.
- You will then be asked to provide some additional information like your PAN card number, ID proof, address proof, etc. You may also need to answer some security questions to verify your identity.
- After verifying your identity, your CIBIL score report will be generated and displayed on the screen.
- You can download your CIBIL report and scorecard for free in PDF format and save it for future reference.
You can follow the above steps to know how to check CIBIL score online for free in India. The online tools on the website give accurate results free of cost – and hence, are a popular choice among potential borrowers. They are convenient and easy to use.
Tips to Improve your CIBIL Score
Following are some tips to boost your CIBIL score:
- Use a mix of secured and unsecured credit.
- Pay your loan EMIs consistently and on time.
- Regularly check your credit score.
- Pay your credit card bills on or before the due date.
- Use credit cards responsibly and avoid maxing out your credit limit.
- Keep your financial records clean with no outstanding debts or late payments.
- Keep your credit card utilization ratio low (around 20-30% of the limit).
- Periodically review your credit report for any errors.
- Obtain copies of your credit reports yourself; don't rely solely on financial institutions.
Remember, maintaining discipline in managing your credit cards is crucial. Avoid using up all your available credit limit.
How to Calculate CIBIL Score?
The CIBIL score is composed of a few factors, each having its own weightage. Here are the key factors considered when calculating credit score.
Repayment History
Payment history has the highest weightage (30%) when calculating the credit score. It affects the CIBIL score either in a positive or negative way. While timely payments boost your score, defaulting or making late payments on EMI adversely affects it.
Credit Duration & Type
The age or credit duration is the second most important factor (25%) required for credit score calculation. If you have paid your loan and credit card debts on time, the lender sees you as a disciplined borrower. This may also help improve CIBIL score.
Credit Exposure
Credit exposure, also known as the credit utilization ratio, refers to the credit amount spent to the credit amount available. Ideally, you should refrain from exceeding 30% of the available credit every day to maintain a good credit utilization ratio. Maxing out or having a high credit exposure implies that you are highly dependent on credit and debt, which negatively affects the CIBIL score.
Other Factors
Apart from the ones listed above, a few other factors also affect your credit score, such as lack of credit history, not having a healthy credit mix, errors in the CIBIL report, etc.
If you have any doubt regarding your credit score free check in India, it is best to get in touch with the lender, discuss the matter and take steps accordingly.
Frequently Ask Questions
No, checking your own CIBIL score does not have a negative impact on your credit score. This is because checking your own credit score is considered a soft inquiry or soft pull, which does not affect your credit score.
In fact, it is a good practice to check your CIBIL score regularly to keep track of your creditworthiness and ensure that your credit report is accurate and up-to-date. However, it is important to note that when you apply for a loan or credit card, the lender will check your credit score, which is considered a hard inquiry or hard pull. Multiple hard inquiries in a short period can negatively impact your credit score, as it may indicate to lenders that you are actively seeking credit and may be a risky borrower. Therefore, it is advisable to limit your credit applications to avoid multiple hard inquiries in a short period.
