What is a CIBIL Score?
The full form of CIBIL is Credit Information Bureau (India) Limited. A CIBIL score is a 3-digit numeric summary of an individual’s past credit behaviour based on credit utilisation, credit mix, and recent inquiries, among others. This score plays a vital role in determining one’s creditworthiness, and hence, it is a key factor that lenders assess when extending credit.
TransUnion CIBIL is a leading credit rating agency in India responsible for assigning a score to individuals based on their credit performance. The credit score assigned by TransUnion CIBIL is called a CIBIL score.
What is a CIBIL Report?
Besides credit score, TransUnion CIBIL also issues a report known as the 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 card, etc., availed so far by an individual. However, it does not contain details of investments or savings.
Also Read: Most Common Credit Report Errors and How to Fix Them
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Why Does the CIBIL Score Matter?
A credit score and CIBIL score are the same, wherein the latter carries the agency's name that assigns 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 low, whereas 900 is the highest score one can get.
Generally, 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 above this number. The CIBIL score rating depends on various factors, each carrying a certain weightage. These include:
- Past performance (30%)
- Credit exposure (25%)
- Credit type of duration (25%)
- Other factors (20%)
What does Credit History and Credit Report mean in CIBIL?
Your credit history and credit report are essential components that define your financial profile:
- Credit history refers to your record of borrowing and repayment over time. It includes details of all your active and closed loans, credit cards, and repayment patterns. Every payment you make (or miss) contributes to this history, which helps lenders assess how responsible you are with credit.
- Credit report, on the other hand, is the detailed document generated by TransUnion CIBIL that summarises your credit history. It contains information such as your personal details, CIBIL Score, loan and credit card accounts, outstanding balances, Days Past Due (DPD) entries, and any defaults.
Difference Between CIBIL Score and CIBIL Report
While both terms are closely related, your CIBIL score and CIBIL report serve different purposes.
- The CIBIL score is a three-digit number ranging from 300 to 900 that represents your overall creditworthiness. A higher score (typically 750 or above) suggests strong repayment discipline and increases your chances of loan approval.
- The CIBIL report is a comprehensive document that contains the data used to calculate your score. It includes your credit history, payment behaviour, outstanding dues, account details, and DPD records.
Factors That Affect Your CIBIL Score
Your CIBIL Score is influenced by various elements that reflect how responsibly you manage credit. Understanding these factors can help you maintain or improve your score:
- Payment History – Tracks how regularly you repay your EMIs and credit card dues on time
- Credit Utilisation Ratio – Shows how much of your available credit limit you’re currently using
- Credit Mix – Represents the balance between your secured and unsecured credit accounts
- Length of Credit History – Indicates how long you’ve been managing credit responsibly
- Number of Credit Enquiries – Refers to how often lenders have checked your credit profile for new loans or cards
- Outstanding Debt – Reflects the total unpaid amount you currently owe across all credit accounts
How to Check Your CIBIL Score Online?
It is important to check your CIBIL score regularly to track any improvement or dip. Follow the steps given below to check your CIBIL score for free:
- Access our CIBIL score form.
- Enter all the requested details, such as name, PAN details, etc.
- Generate OTP and enter it to view your score.
Tips to Improve Your CIBIL Score for Home Loan
Follow the tips given below to improve your CIBIL score before availing of a Home Loan:
- Repay existing loans and pay credit card bills on time.
- Avoid applying for unnecessary credits simultaneously.
- Maintain a low credit utilisation ratio.
- Try not to utilise the entire amount you are sanctioned.
- If you are new to credit, opt for a small-value loan with a shorter tenure and repay it sincerely to build a credit history.
- Limit credit inquiry to a minimum.
- Maintain a mix of secured and unsecured credit types.
Also Read: Quick Tips to Improve Credit Score
What is a Good CIBIL Score for a Home Loan?
Generally, a CIBIL score of 750 and above is considered good for all forms of credit. Those with a CIBIL score of 700–750 may also be able to avail of credit, but at less favourable terms.
In the case of a housing loan too, lenders prefer applicants with a CIBIL score of 750 and above. To a smaller degree, they may offer finance to applicants with a score of 700–749, but in such cases, the Home Loan interest rate is likely to be relatively higher.
