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How To Calculate Your CIBIL Score For Free?

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CIBIL score calculator

CIBIL score is an important tool for financial organizations to judge loan applicants’ repayment potential. The western countries had started credit rating agencies back in the 1950s while India had its first agency in 2000.

These agencies rate the financial behaviour of individuals after the scrutiny of their credit information report. This credit report is prepared by a credit bureau based on all pertinent data from financial institution and companies.

However, now, you can know your credit score by using an online CIBIL score calculator. With different websites offering this calculator, you can know your credit score anytime, anywhere.

CIBIL score

Credit Information Bureau of India Limited (CIBIL) is a credit rating agency that was started back in 2000. It was the first credit rating agency of India. Currently, it handles credit data relating to more than 600 million individuals.

Importance of CIBIL score

All the major financial institutions and non-banking financial companies check an applicant’s CIBIL score before approvingany personal loan. If you havea lower than required CIBIL score, it can be a bit difficult for you to be able to avail a loan. This is what makes CIBIL score so important to the borrowers.

However, it is also equally important to the lenders. It helps them to evaluate and establish whether a borrower is financially responsible enough to be able to repay the loan in time.

CIBIL score range

CIBIL scores range from 300 to 900. A score of 300 is the lowest possible score while 900 is the maximum score a borrower can have.

Lenders prefer applicants with a score of 750 and above to approve any loan. If youdonot have a CIBIL score of 750 and above, chances are that you won’t be able to avail a personal loan until your score reaches the specified limit of 750 and above.

Reputed lenders like Bajaj Finserv provides many borrower-friendly features such as minimum documentation and flexible tenors on their financial products.

Bajaj Finserv brings you pre-approved offers that make availing loans a hassle-free affair. Pre-approved offers are available on numerous financial products including home loans, business loans, and personal loans. You can take a look at your pre-approved offer by providing your name and phone number.

Steps to check credit score with a CIBIL score calculator

Listed below are the things you need to do to check your CIBIL score with an online calculator.

  1. Visit the official CIBIL website and click on the free personal score tab.
  2. Onceyou click on the freescore tab,you will be asked for your identification details such as name, address, PAN details, and date of birth. Fill out the details.
  3. In this step, you will be asked a few questions regarding previous loans and credit cards. Make sure you fill out this part accurately as this will form the basis on which your CIBIL score calculation will be carried out.
  4. Once you have filled out all the required details and submit them, you will be shown your credit score almost instantly.

Checking your credit score online is called a soft enquiry. You can do it as many times you like. Some may think that checking their score too often may bring it down. On the contrary, a borrower should keep a regular check on their scores using a CIBIL score calculator. This will allow them to track the ups and downs of it. Once you get a clear idea on the factors that affect your score, you will be able to take necessary steps that will in time, improve your rating.

Now, let us discuss 3 things that affect your personal loan approval by bringing down your CIBIL score.

  1. Overspending - If you indulge in spending more than 30% of your credit limit, it will adversely affect your CIBIL score. Therefore, it is advisable that you keep in mind the 30% rule next time you avail a personal loan. This will ensure that your credit score improves.
  2. Unpaid older dues - You must understand that the longer you keep your older bills and EMIs unpaid, the more your score gets negatively affected. Thus, you should pay your dues within the stipulated period if you want your credit rating to improve.
  3. Number of unsecured loans - Try to avoid availing unsecured loans too often. If you take this type of credit too frequently, it will bring down your CIBIL score for loan considerably.

These are a few pointers among many that affect your CIBIL score for a personal loan.

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