CIBIL score is an important factor that assesses an individual’s creditworthiness when applying for loans or other forms of credit. This score is calculated based on a borrower’s credit history, ranging from 300 to 900. So, it is very important to understand the basics of “How to calculate CIBIL score.” CIBIL score calculation is based on information in a borrower’s credit report, which contains various financial details.
This report can be quite comprehensive and includes everything from employment details to loan account balances, contact information, and personal data. When applying for a loan, the lender will check CIBIL Score report to assess a borrower’s repayment capacity.
Listed below are the important factors banks and financial institutions used for computing a CIBIL score
- Frequency of Loan Inquiries: It is important to note that each time you apply for a loan, it is recorded in your CIBIL report. However, making multiple credit inquiries frequently can harm your credit score. This could cause CIBIL to perceive you as someone who always needs credit and cannot fulfil financial obligations without borrowing. Moreover, each loan application rejection can also negatively impact your score. So, a solid understanding of the fundamentals of “How to calculate CIBIL score” is crucial for anyone who wants to maintain a good credit score.
- Current Credit Status and Debt Utilization: Your current credit status refers to how much credit you have available and how much of that credit you have used on your credit card. If you have a lot of credit available but are not using much of it, this can be seen as a positive factor and can help improve your CIBIL score. On the other hand, if you are using a lot of your available credit, this can be seen as a negative factor and can lower your CIBIL score. Debt utilization is another important factor used to compute your CIBIL score. This refers to how much of your available credit you are using. If you are using a large percentage of your available credit, this can be seen as a negative factor and can lower your CIBIL score. This is because it indicates that you may be overextending yourself financially and may have trouble paying back what you owe.
- Credit Mix: To improve your credit score, it’s essential to maintain a healthy credit mix that includes a combination of secured and unsecured loans. This indicates that having a diversified credit portfolio is important instead of solely relying on one type of credit. A mix of secured loans, such as a home or car loan, and unsecured loans, such as personal loans or credit card bills, can demonstrate to lenders that you can handle various forms of credit.
- Payment Record History: Your creditworthiness is determined by your past repayment history, which is critical to your CIBIL score. This past payment record accounts for a significant portion of your CIBIL score. It’s important to note that any defaults on loan repayment and delayed EMI payments may severely impact your credit score. Regular and timely payment of loan EMIs will help maintain a good credit score, reflecting a responsible borrower capable of meeting their financial obligations.
How to Check CIBIL Score Online?
- Visit the official website of a financial institution such as Bajaj Finserv to check CIBIL Score online. Look for the option “Check Score.” Click on the link to check CIBIL Score.
- Log in using your Mobile number. You will receive an OTP.
- Enter OTP to verify your mobile number.
- Fill in all required information, such as your name, date of birth, PAN card number and contact details to check CIBIL Score.
- Verify that information has been entered correctly before submitting the form.
- Wait for your CIBIL score to be generated – which can be viewed online on Dashboard.
Check CIBIL Score by Bajaj Finserv Credit Pass
Bajaj Finserv Credit Pass is an online subscription service that gives customers real-time access to their Credit Health Reports. This online service is very helpful for users who want to know how to calculate CIBIL score. With this offering, customers can check CIBIL Score, understand their financial health, and take steps towards improving it. By subscribing to the Credit Pass, customers can check CIBIL scores frequently. This information helps determine eligibility for loans or credit cards. The Bajaj Finserv Credit Pass is an affordable subscription service, making it accessible to many customers who want to check CIBIL score online. Customers can subscribe to Bajaj Finserv Credit Pass for Rs 99 per year. Bajaj Finserv Credit Pass provides unlimited access to their Credit Health Report and other Bajaj Finserv Credit Pass features.
Read Here More: Four Quick Ways to Enhance Your Credit Score
Conclusion
Monitoring your CIBIL score is crucial for financial stability and securing credit in the future. The CIBIL score calculator offers a simple and convenient way to check your credit score online by entering basic personal and financial information. Understanding the factors that impact your CIBIL scores, such as past repayment history, credit utilization, and credit inquiries, is essential to maintaining a good credit score. Maintaining a healthy credit score allows borrowers to access better credit opportunities, including lower interest rates and faster loan approvals. Overall, check CIBIL score regularly on reliable online services such as Bajaj Finserv Credit Pass and taking measures to improve it can help you achieve your financial goals and secure a better financial future.