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CIBIL Score: Meaning

CIBIL score is a numeric summary of an individual’s past credit behaviour. This score plays a vital role in determining one’s creditworthiness. Therefore, it is crucial to learn what is CIBIL score, in detail.

TransUnion CIBIL is a leading credit rating agency in India responsible for assigning a score to individuals based on their credit performance. Since TransUnion CIBIL assigns this credit score, it is also called the CIBIL score.

What is a CIBIL credit score? 

Credit score and CIBIL score are the same, wherein the latter carries the agency's name that prepares it. The CIBIL score ranges from 300 to 900, and individuals are assigned a score within this limit. Here, any score around 300 is considered poor, whereas 900 is the highest score one can get. However, a score of 750 and above is considered a good CIBIL score, and individuals can enjoy fast loan or credit card approval if they manage to keep their score around this number.

CIBIL score rating depends on various factors, and each of these components carries a certain weightage. These include:

  • Past performance (30%)
  • Credit exposure (25%)
  • Credit type of duration (25%)
  • Other factors (20%)

How to Check Credit Score Online?

After learning what CIBIL score is, it is important to check it regularly to track any improvement or dip.

The CIBIL score can be checked by visiting the official website of TransUnion CIBIL. They allow users to check their credit score only once a year. For multiple checks, individuals will need to pay an annual fee, depending on the plan chosen.

Register with CIBIL and know how to check credit score by following the steps below.

Step 1: Click on the option ‘Get CIBIL Score’

Step 2: Look for a ‘Click Here’ button to get the Annual CIBIL Score

Step 3: Enter personal information such as name, email ID, password, Aadhaar Card, and PAN Card

Step 4: Click on ‘Accept’ to continue

Step 5: Enter the OTP received in the designated space

Step 6: Click on the ‘Go to Dashboard’

Step 7: Log in with your credentials to check the CIBIL score

Tips to Improve Your CIBIL Score for Home Loan

Follow the below tips to improve your CIBIL score before availing of a high-value home loan.

  • Repay existing loans and pay credit card bills on time
  • Do not apply for multiple credits at a time
  • Keep credit utilisation ratio below 40%
  • Try not to utilise the entire amount you are sanctioned
  • Compare different lenders to avail the best interest rates and reduce cost
  • Do not apply for a loan as a co-signer unless required at that time
  • If you are new to credit, opt for a small-value loan with a shorter tenor and repay it sincerely to build a credit history
  • Do not borrow without concrete repayment planning
  • Limit credit inquiry to a minimum
  • Maintain a mix of secured and unsecured credit types
  • Mention all additional income sources alongside the primary

What is a Good CIBIL Score for a Home Loan? 

The answer to ‘what is CIBIL score for home loan’ may vary depending on the credit applied for. Usually, a CIBIL score of 700+ is considered sufficient to avail of a home loan. Since a home loan is asset-backed, individuals with a less than perfect credit score of 750+ may be able to avail of credit to. However, it is wiser to maintain a high CIBIL score to qualify for a sizeable loan amount against reasonable home loan interest rates.

What is CIBIL Report?

Besides credit score, TransUnion CIBIL also issues a report, known as Credit Information Report (CIR). It documents the payment history of individuals over a specific period. This report contains all details regarding every loan, overdraft facility, credit cards, etc., availed so far by an individual. This report does not contain details of investments, savings, etc.

With adequate knowledge of what is CIBIL score, pursue your financial goal without any difficulties.