As banks are raising their interest rates on loans, EMIs are getting higher and the household budget is under increasing pressure. Now, borrowers are looking for cheaper loan options. Here’s One Way To Get A Relatively Cheap Loan CIBIL Score, The score indicates the creditworthiness of a borrower. Know in detail how it helps in getting cheap loan and how to get a good one credit rating Scores can be maintained:
CIBIL Score and Loan Interest Rates
CIBIL Score is a credit rating assigned to borrowers by the company TransUnion CIBIL. The score is a three digit number and ranges from 300 to 900. The higher the score you have, the better. Generally, a score above 750 is considered good, where the chances of loan approval are high. The score reflects a borrower’s creditworthiness, which helps the lender reduce the chances of loan default.
Lenders offer their interest rates based on the borrower’s CIBIL score. For example, the lowest interest rate on a home loan which State Bank Of India Now offering 7.55 per cent per annum to the borrowers. It will also require the borrower to have a CIBIL score of 800 or above. Those with a CIBIL score of 750-799 will be offered an interest rate of 7.65 per cent. For those with 700-749 scores, it will be 7.75 percent; For a score of 650-699, this would be 7.85. And, for those whose CIBIL score is between 550 and 649, the home loan will be the costliest at 8.05 per cent interest.
How to maintain a good CIBIL score?
Eliminate your credit card limit by up to 30% only: Always keep credit card spend up to 30 percent of the card limit. If you’re struggling to stay within the card’s current limit, get a credit card with a higher top limit. To get a good CIBIL score, the credit utilization ratio should be limited to 30 percent.
Never default on loan repayment: Always remember not to default on any credit repayment, be it a loan or a credit card. Default has a huge impact on a person’s credit rating. This is the first and foremost thing if you want to maintain a good CIBIL score. Pay within time and never be late. Paying off loan or credit card dues has a huge impact on your CIBIL score.
Miscellaneous Loan Products: It is better to diversify the loan portfolio with a good mix of both secured and unsecured loans to achieve a high CIBIL score. A credit card is an unsecured loan, whereas a home or vehicle loan is a secured loan.
To control inflation, the Reserve Bank of India (RBI) raised the key repo rate by 50 basis points (bps) in early June, nearly 40 basis points after the central bank’s monetary policy committee hiked it. There was a second increase within a month. -Cycle Policy Review In May, the retail inflation rate in May stood at 7.04 per cent, which is higher than the RBI’s target of 2-6 per cent.
read all breaking news, today’s fresh newswatch top videos And live TV Here.