Highlights:
- Here’s How a Good CIBIL Score Can Prove Beneficial
These days, most people rely on loans to fulfil their needs and desires. When they want to buy a home, they avail themselves of a Home Loan. When they need money to purchase a new car, they apply for a car loan. To fund the education of their children, they opt for education loans and to pay for their weddings, they opt for personal loans or loans against property. Loans have become popular because they take away from people the burden of paying for something immediately. They let people keep their savings safe for a rainy day while still allowing them to fulfil their needs and desires.
Since more and more people are opting for loans, cases of loan default have increased too. When a borrower defaults on a loan, the lender loses money. Thus, these days, lenders have become stringent about borrowers meeting the set eligibility requirements. The inability to do so inevitably leads to loan rejection. A crucial part of loan eligibility is the CIBIL score – a good CIBIL score is an essential criterion for loans.
As a side note, if you are applying for a loan, be it of any kind – secured or unsecured, do a CIBIL score check before applying. Apply only if your free CIBIL score check shows you a reading of 750 or above. If your credit score is below 750, work on improving it first. In this article, we will stick to how a good credit score can help you enjoy your festivities at the fullest by letting your loan take care of your high-ticket purchases.
Here’s How a Good CIBIL Score Can Prove Beneficial
A good CIBIL score will ensure you get a better than expected credit at the best lending terms. Here are the ways in which a good CIBIL score helps.
1. You Will Be Approved for a Loan Quickly
Lenders make money by charging interest on the money loaned to borrowers. Thus, it is obvious that all lenders want more and more clients who they know will be able to clear EMIs on time. If your CIBIL score check shows a credit rating of 750 or above, know that you are the ideal borrower for a lender, simply because it is highly unlikely that you will default on loan repayment and thus, you present zero risk for the lender. Thus, getting approved for a loan will be a relatively hassle-free experience for you.
2. You Will Be Offered a Better Interest Rate
When it comes to loans, especially big-ticket loans, such as a Home Loan or a loan against property, the interest rate is the key factor that determines the affordability or the cost-effectiveness of the loan. Low-interest rates not only make the Home Loan EMIs affordable but also allow borrowers to save money in the form of reduced interest outgo. Lenders extend low-interest-rate Home Loan deals to borrowers who have a good CIBIL score and a good CIBIL score for Home Loans in anything above 750.
3. You May Be Able to Access a Higher Loan Amount
Yet again, lenders know that borrowers who have a good CIBIL score are responsible people who will pay the loan money on time. Therefore, lenders understand that there is not much risk involved in giving such people a higher loan amount than they are eligible for. Having access to a higher loan sanction helps borrowers as it allows them to better fulfil their needs and desires.
4. You Will Have Better Negotiating Power
Lenders want borrowers as much as borrowers need lenders and lenders especially need borrowers with a good CIBIL score. If your CIBIL score is 750 or above, you will have high negotiating power. This means you will be able to negotiate for better loan terms and conditions, such as low-interest rates, higher loan sanction, zero pre-payment and foreclosure charges and a long tenor to make repayment easy.
5. You Get Access to Exclusive Offers
The festive season is the time when lenders try their best to lure more and more customers. Mostly, they do so by coming up with lucrative loan schemes. If you have a good CIBIL score and you are planning to apply for a loan, rest assured that many lenders will come to you with exclusive offers, tailored to your needs and repayment capacity.
Final Words
Anyone planning to apply for a loan must have a CIBIL score of 750 or above as this is considered a good CIBIL score for any type of loan. If a CIBIL score check shows your credit score to be below 750, do not worry. Building a good CIBIL score is easy. Practice strict financial discipline, pay credit card bills and EMIs on time, maintain a low credit utilization ratio, do not borrow money until and unless you need it, keep a check on all your co-signed loans and check your credit reports for errors from time to time. Do these things and your CIBIL score will touch 750 in no time.
Also Read: Tips to Maintain Your Business CIBIL Score Above 700
