A Complete Guide to CIBIL Score for Education Loan Overview
Like any other loan application, CIBIL score is think over while evaluating education loan applications. Lenders check your credit to assess your ability to repay the loan.
Basically a CIBIL score is a three-digit numerical summary of your credit history. This is the value of a credit score is generally between 300 to 900. Your CIBIL score is prepared on the basis of your entire credit history. This is includes all the secured and unsecured debt and the any other debt that you may or may have.
Whenever you go to take a loan or get a any product financed, on that time your CIBIL score can checked by the financing companies or bank.
A score of between 650 and 749 is considered as a good cibil score, and lenders may offer you a loan after checking your other financial details. However, lenders generally consider 650 as the minimum CIBIL score required for a loan. Marks between 550 and 649 are average and need to be worked out.
Here is a summary of your creditworthiness based on your score:
300-599 - A score below 600 is considered too low. With such a low score, the chances of getting a loan are almost impossible. If you have such a bad score then try to improve your credit score before applying for loan in bank, or else, bank can reject your loan request if you will lower your score.
600-749 - A score below 750 is not considered good, but some lenders who take the risk may penalize your loan. But it just depends on your ability to pay depending on your job, salary, if you have any other ongoing loan. Make sure you contact the appropriate bank/NBFC to save yourself from rejection.
750 and above - Congratulations! Your CIBIL score does not put any hurdle in getting education loan. Scoring over 750 points means you're doing well financially, and it's time to reap the rewards. There are other benefits to getting a higher score as well: the approval process will be faster; Since you are the customer, the interest rate is negotiable.
If your credit score is below than the requirement then your home loan application can be rejected by the bank. So, if you know about your cibil then please stop applying again and again into other banks. This will make lower your credit score as various banks making inquiries on an individual's credit rating are viewed negatively.
Importance of your CIBIL scores to get sanction for education loan.
- Your cibil score is based on your payment history, types of credit used application for new credit and amount you own.
- For the borrowers of education loan, your required CIBIL score should be at least 650 to avail a student loan.
- But if you want a loan at the best interest rate from the bank then your minimum required cibil score should be 750.
- This is considered a good cibil score of any borrower, and if your CIBIL score is between 730 to 900 then it is one of the very best CIBIL score.
- With the help from your good and maintained cibil you can get the loan on best and lowest interest rates from the bank.
If your cibil score is less than 700, Below are some tips that you can follow to improve your CIBIL score. There are some tips mention Below that you can follow to improve your CIBIL score and make it healthy.
- Make all of your payments always on time and pay the entire due amount. Partial payments will still be recorded as overdue in your report and late payments will not be accepted by banks. This make you pay the penalty on your repayments.
- Do not ever try to use your full credit card limit. Always Track utilization of your credit and keep your outstanding balance low to get such a good credit score.
- Always Keep tracking your credit score and history by accessing your credit information report periodically and correcting errors, if any.
- Always Monitoring your accounts (both single and joint ) regularly so that no payment will be missed by you or the joint account holder at the end of the month.
If your CIBIL score is less than 750 then your chances of getting any kind of loan are very less. To get a loan sanction at good interest rates you have to work on your cibil score.