CIBIL Score or Credit Score is very important for every bank customer today. Without a good CIBIL score, it becomes difficult to get loans or credit cards. The CIBIL score is based on a person’s bill payments, EMI payments, and credit card usage history. This score helps determine whether a person can repay a loan or not. So, how much should your CIBIL score be? Let’s understand more about it below.
How Much Should Your CIBIL Score Be for a Loan?
These days, CIBIL score is asked in many situations. Whether it’s for a bank job, insurance policy, loan, or credit card, having a good CIBIL score is essential. The CIBIL score ranges from 300 to 900.
For loans, a CIBIL score of 750 or above is considered good. The closer your score is to 900, the better it is. A score below 600 is considered poor, and getting a loan with such a score can be difficult.
Benefits of a Good CIBIL Score
If your CIBIL score is above 800 or close to 900, banks will quickly approve your loan. You may also get discounts on interest rates. With a high CIBIL score, you can get cheaper loans, discounts on insurance premiums, and even good job opportunities. Also, you might get zero down payment for a large loan amount.
On the other hand, if your CIBIL score is below 600, either you won’t get a loan at all or the loan will come with a high-interest rate.
How to Get a Loan with a Low CIBIL Score?
Even if your CIBIL score is poor, you can still get a loan. In this case, you can apply for a secured loan. A secured loan allows you to get money by pledging valuable assets like jewelry, a car, or property as collateral.
Option of Secured Credit Card
If you don’t get a secured loan, you can consider applying for a secured credit card. For this, you need to have a fixed deposit (FD), and the credit card limit will be based on the FD. This card works alongside the FD.
What to Do if You Are a Loan Defaulter?
If you miss your EMIs consistently, the bank will classify you as a loan defaulter. Once you’re marked as a defaulter, it becomes difficult to get loans from other banks. Many people think that other banks won’t know about it, but banks can easily check your CIBIL score and get all the information.
In such cases, you might even find it hard to get a loan from NBFCs (Non-Banking Financial Companies).
Conclusion
Your CIBIL scores is a crucial financial number that determines your ability to get loans and credit cards. A good CIBIL score can help you get loans at lower interest rates and can provide you with financial security. If your score is low, you can consider applying for a secured loan or a secured credit card. Keep in mind that you can improve your CIBIL score by paying bills and EMIs on time, ensuring better financial options in the future.
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