If you know anything about CIBIL score, then you know that it plays a huge role in your life. Whether you are a student or a working professional, if you have ever taken a loan in the past or used credit cards, then it's really important that you check your credit report on a regular basis. The following are the top 10 reasons that support this idea:
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To say that the startup industry has become competitive today would be an understatement. This is because the SME industry is booming and has become one of the major driving forces behind India’s economy. However, there are many things that you can do to survive this competition and emerge as a winner. These are:
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Unlike our bank statements credit score is not something we check regularly. We check it only when we need to apply for a loan or worse still we come to know about it being low when our loan application is rejected. The loan application rejection may come as a surprise but at that juncture you may be left with little choice but to look for an alternative lender or wait for your score to increase so that you can get the loan sanctioned. However in case you have not waited till the crucial moment to check your credit score and you realize that it is falling, then what can you do to deal with the situation.
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So you have decided to be in control of your financial destiny. And since the credit profile matters a lot in your path to achieve the set goals on pecuniary front, you obtain your free credit report only to find out that it seems to be no better than a medical report. You are able to see a lot of data in various formats on the report but are not at all sure on what to understand from it. There is no need to sulk, if this has been the case with you. It may give you some respite, but as per a survey conducted by Credit Sudhaar, less than 5% of people actually are able to make some sense from their bureau reports.
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Most of the people when asked about how to chart out the way to financial success would mention spend less and save more. Can this be defined as the process to financial success? The answer is bot yes and no. Yes because one has to save to create wealth which is what is being advised and no because it is not just about spending lesser amount and saving larger portion of earning in the quest of financial success. Path towards being financially successful is far more complexed and needs both keeping focus various facets and consistent efforts.
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The mystification around credit score is a given. Despite that fact that the bureaus have been existing for decades globally and have been in India for over 16 years now, the people still get perplexed about the CIBIL score. Various theories keep doing rounds and people today when talk about credit profile management, only limit it to repayment of dues. There is no denial that repayment of the obligations has to be timely on an ongoing basis. Repayment carries the most weightage as far the score goes. But there are other important factors as well that impact the scores grossly.
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The 3 digit number on a person's credit report called the credit score can have a 6 digit impact on their financial lives.
Freescoreindia provides people with the tools required to understand their credit profiles and unlock the power of their credit score.
By the virtue of being the first credit bureau in India, the credit scores colloquially are called CIBIL Score. The score given by any credit bureau is called credit score. There are four bureaus in India viz. Credit Information Bureau India Ltd (CIBIL), Equifax, Experian and Crif Highmark and all of them give out credit scores.
The bureaus in India rate an individual on a scale of 300 to 900. A credit score of 750 and above is deemed to be good and individuals in this score band will have faster access to funding. But a person with low credit score still may be able to get loans since the underwriting is based on various factors.
Your credit score shall not only impact the approval of loan that you apply, but also has the potential to influence the rate of interest beign charged. A lower rate of interest will result into huge savings. Therefore, it is highly important to be aware of the credit score.
Your credit report has primarily three sections. Personal information, details on all the loans and credit facilities that you would have taken and enquiries from lenders. Each of this broad information is critical to your access to credit and hence need to be looked at with care.
The credit bureaus assign credit score to an individual based on complex algorithms. Broadly, there are five factors that impact your credit score. They are:
One of the major reasons why one should check the credit reports regularly is a high error rate. As per a unique survey, one of four reports has errors. These errors can lead to severely impacting the credit score and diminishing the chances of access to loans at the time of need. To know more about the reasons why one should check score regularly read more from our blogs.
Unlike developed economies, where one has access to free credit score once in a year, people have to pay for the same in India. We at freescoreindia have resolved to extend free credit score for two reasons, first to bridge the disparity on availablity of free credit score and second to educate and spread awareness on this important aspect of every one’s financial life.
You can withdraw your credit report from any of the credit bureaus as many times as possible. This will not have any bearing on your credit score. However, the enquiries made by lenders can impact the credit score.