Whenever you apply for a loan or credit card, your lender will review your CIBIL score and report to evaluate your credit history and credit worthiness. Although it is not necessary to check your CIBIL report before applying for a loan, it is highly advisable.
Your lender may reject your loan or credit card application if your CIBIL score is less than 750. If your CIBIL score is above 750, you should still need to check your CIBIL report before applying.
Because sometimes, you may be a victim of CIBIL’s data mismatch error where other people’s accounts may incorrectly reflect on your CIBIL report. The result may not be desirable as your loan or credit card application would reject if those unknown accounts have any problems.
So, it’s better to be aware of your CIBIL score and report before applying for a loan and take the below list of advantages.
Avoid loan rejection:
If you are already aware of your latest CIBIL report & score, it would be helpful to understand your current position and where you stand from the CIBIL perspective.
Suppose your CIBIL score is comparatively lower than the lender’s expectation; you don’t need an expert to figure out that your loan application will reject. Your report may also have some “Settled” or “Written-off” status, which will land you a loan rejection.
The bad thing is that CIBIL stores every finance-related activity in their database, including the rejection. So, avoid loan rejection for a healthy CIBIL report because each rejection hurts your CIBIL.
Get a lower interest rate:
Your lenders always prefer a good CIBIL score to process your loan request because your CIBIL score will decide your trustworthiness. Unfortunately, many people don’t know that a healthy CIBIL report will make them eligible for a more reasonable interest rate.
Technically everybody loves to save money and will not refuse to accept a lower interest rate. Because interest rates affect the EMI one pays on any loan. Therefore, if your CIBIL score is good enough or higher than their expectation, sometimes you may have a chance to get a lower interest rate.
So, checking your CIBIL report before applying for any loan will help you grab a better deal or negotiate with the lenders to lower the interest rate.
Enhance loan eligibility:
As I mentioned earlier, your banks or lenders always rely on your CIBIL scores and CIBIL report to decide whether the loan or credit card should be approved. However, lenders prefer a borrower with a good CIBIL score, and the borrower can use this solid reputational collateral to their benefit.
Accessing your CIBIL report before applying for any loan may give you politely bargaining leverage with the financial institution for availing of the loan at more reasonable terms and conditions if you have a high CIBIL score and a nutritional CIBIL report.
Avoid lowering down credit score:
If you don’t know the condition of your current CIBIL report, don’t apply for any loan because multiple loans or credit card rejections lead your CIBIL score down. By doing such practices, your CIBIL score will go down eventually.
CIBIL permanently stores every of your financial-related activity. So, avoid lowering your CIBIL score by doing anything like this.
Check the CIBIL report for free:
If you want to check your CIBIL report free of cost, you can do it. The question is, how can you do it? Well, there are few options available at the movement. The first option is to visit the CIBIL official website and scroll down a little until you find To get your Free Annual CIBIL Score & Report link.
Click the link, and then fill out the form on the next page and verify the OTP. Enjoy your free CIBIL report. But remember, you will only get one free CIBIL report for an entire year. If you cannot generate your free CIBIL on cibil.com, try to get it on paisabazaar.com or bankbazaar.com.
Read more-
- How to remove “Settled” status from CIBIL report?
- How to remove “Written off” status from CIBIL report?
- How to raise a dispute in CIBIL?
