A credit score is a 3-digit integer in the span of 300-900, 900 being the highest. The credit bureaus determine credit scores in the country after studying several parts like the length of your credit history, repayment accounts, credit inquiries, among others.
When you administer for a credit card or a loan from a bank of NBFCs, holding a higher credit score may empower you to receive further advantages such as a higher loan quantity, lower interest rate, and your selection of tenure to repay the mortgage.
Credit Score Range and What It Implies
A credit score in India varies between 300-900. It would be best if you constantly took measures to bring your credit score nearer to 900. A higher credit score improves your chances of receiving a good deal on loans and credit cards.
|CIBIL Score Range||Meaning|
|NA/NH||This indicates it is either “not applicable” or no history.” Suppose you have not utilized a credit card or have never exercised a loan. You will have no credit history.|
|350 – 549||A CIBIL score on this scale is regarded as a bad CIBIL score. It indicates you have been delayed in|
Paying credit card bills or EMIs for loans. With a CIBIL score on this scale, it will be challenging for
you to arrange for a loan or a credit card as you are at a considerable risk of shifting into a
|550 – 649||A CIBIL score on this scale is considered fair. It implies you have been trying to pay the dues on|
time. The interest rates on loans could also be costlier.
|650 – 749||If the CIBIL score is on this scale, you are on the right path. You should maintain displaying good|
credit behavior and improve your score more. Lenders will analyze your credit application and
grant you a loan. However, you may still not possess the negotiation powe r to make the best deal
on the rate of interest for a mortgage.
|750 – 900||This is an outstanding CIBIL score. It implies you have been consistent with credit payments and|
have an excellent payment history. Banks will grant you loans and credit cards as well
contemplating you are at the lowest risk of converting into a defaulter.
CIBIL Score Range
The CIBIL score (a 3-digit number) compiles the credit history from various details on the Credit Report like ‘Enquiries’ and ‘Accounts.’ The CIBIL score ranges between 300 and 900. The more expensive the CIBIL score, the more relaxed it is to get a loan or a credit card accepted. Getting late payments and multiple inquiries will lead to the CIBIL score decreasing. Any score of 750 and above is deemed ideal, and you will fit for numerous credit cards and loans. If your credit score is smaller than 750, you will discover it hard to avail of a loan from NBFC and banks.
If the loan is accepted, the interest rates will be significant if the CIBIL score is near 750. Banks and NBFCs will refuse the application if the credit score is weak. The four important segments of the credit report are Account History, Credit Enquiries, Public Records, and Credit Summary. The various circumstances that are recognized by CIBIL when they compute the credit score are the credit mix, new credits, repayment history, tenure, credit utilization, and credit balance.
Experian Score Range
The Experian score stretches within 300 and 850. A good credit score is anything over 700. The higher the credit score, the more positive banks and NBFCs are that you will repay the loan. A credit number of 800 and higher is considered excellent. Most credit scores rank between 600 and 750. Approval of car loans also depends on the credit score. The bigger the credit score, the down payment, and the interest rates will be economical. Various lenders like NBFCs and banks grant loans and credit cards based on the credit score.
Credit scores varying from 300 to 579, 580 to 669, 670 to 739, 740 to 799, and 800 to 850 are rated very poor, fair, good, very good, and excellent. The credit score depends on several factors: derogatory information, recent credit applications, credit history, credit history length, credit utilization, and payment history. Some factors that do not affect the credit score are details not possible in the credit report, where you stay, child support payments, income, employment, and age. Repaying all your bills on time and not getting several inquiries will guarantee that your credit score does not drop.
Who Computes Credit Score?
When you make a relevant transaction to determine your score, banks send aspects about it to all four credit bureaus. To send features to all credit agencies is a charge by the RBI. Essentially, banks hold Credit Information Companies up-to-date about your financial practices. If a bank requires checking online credit score, they can request any one of the bureaus. It doesn’t imply which one because all will hold the same score for you– all four are relatively authoritative and on par.
After receiving the message from the bank, credit bureaus takedown to getting more items about the financial practices from other banks and financial institutions. They then process this data to formulate what is called a Credit Report.
Why to check Credit Score?
It would be best if you kept a close vigil on your Credit Score. It is the best way to assess your opportunities to receive a line of credit. Another reason why you should follow your score is to know if it falls or if a mistake has been made by credit agencies while determining your score. It will assist you in making timely amends.