How to know your credit score?
You can easily find your personal CREDIT score by talking to our Relationship Manager Now. After providing the requisite details, you can generate your personal Credit Information Report (CIR).
Why is a credit score important?
A credit score is of paramount importance as it reflects the following key factors with regards to your credit history:
A credit score reflects your repayment history: Whether you have defaulted on payment of your EMIs, or made your credit repayments on time, all transactions pertaining to your credit repayment are shown in the credit score. You must remember that past repayment on your loans or credit cards counts for 35% of your overall credit score.
Credit score reflects your existing debt: Before you apply for a loan, you must know that your existing debt counts for 30% of your credit score. A financial company will use the credit score to find the existing amount of credit sanctioned and utilised. This is also known as credit utilisation.
Credit score reflects the type of credit availed: Financial companies look into the credit score to find whether an individual has availed a balance of credit. This factor contributes 10% to the credit score. In other words, before you apply for a personal loan, you must remember to create a balance of credit, or availing both secured and unsecured loans. Not availing credit altogether can also impact the credit score.
Credit score reflects repayment duration: Your credit score reveals the duration of the loans along with your repayment history. The tenure of your loan contributes 15% to the credit score.
Credit score reveals unsuccessful credit inquiries: You must remember that each time you make a credit inquiry, it is reflected in the credit score. Along with multiple credit inquiries, rejection of your credit request will result in a poor credit score.
The bottomline: Thus, it is important to have a good credit score for availing credit of all types, including personal loans. While a good credit score will help you to secure credit at an attractive rate of interest, you might end up taking loans at higher rates of interest with a poor credit score. With attractive interest rates, you can save money, and make progress on achieving your financial goals.
If after checking your credit health, you want to apply for a personal loan, then you can consider personal loans confidently