A personal loan is an unsecured mortgage that one can always avail of in need during an emergency or a short-term urgent big expense. Getting such loans is not a big deal if you have a good credit score and income level, but when certain factors are mentioned going down, it becomes difficult to get a loan. This blog will help you understand the importance of the CIBIL score and how you can quickly check your CIBIL score online by Pan number.
What is a Cibil score?
CIBIL is an agency approved by the Reserve Bank of India (RBI). It helps people to calculate their credit scores by checking the CIBIL score. CIBIL stands for Credit Information Bureau(India) Ltd. With the help of the CIBIL score, one can always check their creditworthiness. This score summarizes one’s credit history, the total amount of credit one has taken, how they have repaid, and other factors.
Repaying the loan in time, less exposure to credit cards and several other factors can help one build their CIBIL score.
The standard CIBIL score lies between 300- 900. The greater the score, the more chances of getting a loan. If one has a score of more than 750, it would be easier for them to avail of the loan. If one has less than 550, it would be a little difficult for that individual to avail of the loan. In such cases, the financial source may increase the interest rate on loans.
How to avail of an urgent Loan with a Low CIBIL score?
Sounds too good to be true? But it’s true. Even though it may seem impossible to avail of a loan at a low score, it is possible to get a loan.
- The first thing one should always do is to reassure that their CIBIL score is low, as sometimes the CIBIL report may not be updated. In this case, they should report and get the score corrected. So one should regularly check their CIBIL score.
- Find a co-applicant. Check their CIBIL score. If one can find a co-applicant with a good CIBIL score, they have a much higher chance of getting a loan.
- If one with a low CIBIL score somehow manages to find a guarantor(someone liable to pay if one is unsuccessful in paying in time), they may have a much greater chance to avail of the loan.
- Even if one has a steady income source or another source, they should include this as proof. As a result, they will be eligible for the loan.
- One can also apply for a lesser amount of loan. One should always think for once from the lender’s perspective, so availing of a loan for a lesser amount is always better than asking for more.
- Getting a zero credit score or NA, NH in a credit report states that the user hasn’t used the credit card for three years or more than that, then they should explain their case in this scenario, and if the lender agrees, then they would provide the loan for a bit more interest rate.
How to check CIBIL score Online using PAN Number?
People can always check their CIBIL score online using a PAN number. Transunion CIBIL manages the people’s credit scores, a credit rating bureau. To check your credit score online then, you should :
- Log in to the CIBIL portal.
- Click on the link which states to get Your CIBIL Score.
- Choose your Subscription plan.
- Provide the required details.
- Create a secure password.
- Select income tax ID (PAN) and enter PAN number.
- Click on Proceed and answer the questions accurately.
- Finish the process by clicking on the make payment tab.
- If this is for a single time, then ignore all the subscriptions and proceed to your account.
- Login to your account using the credentials.
- Enter the details required.
- Submit the form at the end to see your desired CIBIL score.
One can always do a free CIBIL score check once a year. Or one can also use other identification proofs like Passport, Voter id, or Driving license.
If one finds any false statement or report, they can always raise the dispute using the CIBIL website or by post.
How is CIBIL Score Calculation done?
Every credit company has its proprietary algorithm to calculate an individual’s credit score. A CIBIL score calculation is done based on all these metrics:
- The payment history- This is the main factor that decides the score, how much a person spends and how they manage their balance sheet. This factor attributes approx 30% to the score.
- Exposure to credit cards – This factor is responsible for approx 25% of the credit score.
- Credit type and the loan duration – This factor contributes another 25% to the credit score.
- Other Factors- Other factors may include credit utilisation; one’s recent credit behaviour adds up to another 20% to the credit score.
One always has ways to get personal loan, but the approach should be accurate. With the methods as mentioned earlier, one can always avail of a loan and always be cautious of factors mentioned above to improve their CIBIL score.