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Confused on Checking Your HDFC CIBIL Score? Let’s answer some FAQs for you

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One of the biggest financial assets one can have nowadays is not gold or real estate, but its credit score. But since it is still a relatively new concept for many people, one can get confused about it. So let us answer some FAQs and clear the air for you.

What does a credit score actually mean?

Your three-digit credit score typically ranges between 300 and 900 points, with higher scores indicating better credit. How well you have previously managed your debt repayment responsibilities, such as credit card payments and loan EMIs, gives insight into your creditworthiness and repayment behaviour.

How is your HDFC CIBIL score shown?

You can check your credit score on any of the numerous financial websites that are accessible online, or you can download it directly from the credit bureau, if you want to know what it is.

Customers will be able to spread out their requests for credit reports and receive one free credit score and report from each of the Indian credit bureaus (TransUnion CIBIL, Experian, CRIF High Mark, and Equifax) at least once a year. Therefore, they will be able to receive one free credit score from each of India’s four credit bureaus.

What elements have an impact on our credit score?

The four credit bureaus each have their own sets of scoring standards, but when determining your IIFL CIBIL score, they all take into account your credit usage ratio, credit mix, repayment history, and number of credit inquiries.

What occurs if your credit score is inadequate or bad?

Lenders are more likely to offer customers with good credit ratings favourable terms and conditions as well as a wider range of options because your credit score is one of the most crucial factors they take into account when reviewing your loan or credit card application.

Because lenders frequently favour borrowers with credit scores of 750 or higher when approving loans, having a HDFC CIBIL score below this mark may lower your chances of being approved for one.

Because they pose a higher risk of future debt default, lenders either grant loans to borrowers with bad credit at higher interest rates or completely reject their applications.

Do you believe we will charge you a lower interest rate for our loan if you have a high IIFL CIBIL score?

Lenders are more likely to treat borrowers with good credit scores favourably and to approve loan and credit card applications more quickly because they have a history of on-time repayment and pose a lower risk of default in the future.

As an alternative to conventional pricing, where the interest rate is determined by the applicant’s credit profile, some lenders now offer credit risk-based pricing for loans. People with good credit may qualify for loans with lower interest rates, which reduces the cost of the loan overall. 

What options are available to you to raise your HDFC CIBIL score?

Try to keep your credit utilisation rate between 30 and 40% to raise your credit score. Make prompt loan payments, maintain a healthy credit mix, keep an eye on any loans you guarantee or co-sign, avoid applying for loans and credit cards directly from lenders, and regularly check your credit reports using the free credit score feature.

Consider paying off your unsecured loans, like credit card and personal loans, or replacing them with secured loans, like a second mortgage, a loan secured by gold, or loans secured by securities, if you want to improve your credit score as soon as possible.

By increasing the percentage of secured loans in your overall credit mix, this will improve your IIFL CIBIL score.

Does a person’s credit score depend on their family history?

No. The credit history or profile of your family members has no bearing on your credit score, and the reverse is also true.

However, you are jointly and severally liable for making sure the debt is paid off on time if you agreed to serve as a guarantor or co-signer on a loan. Your credit score will suffer if the primary borrower defaults on the loan or misses payments if you co-sign the loan or act as a guarantor.

What is a credit report, exactly?

A summary of your credit history is one of the items on your credit report. Information on current credit card balances, past credit account information, and unpaid debts are all included. 

Your IIFL CIBIL score is calculated using all of this data.

What steps go into the creation of a credit report?

This demonstrates that information about your current debt and the existence of any outstanding loans, as well as information about your creditors and credit card company, can be found in your credit report.

We need to know how to obtain a copy of our credit report.

Each of the four Indian credit bureaus is required to provide a free credit score report to every citizen of our nation once a year. Consumers should space out their requests to guarantee they receive one free credit report each quarter of the year. As a result, they will be able to get one free credit report.

For a free HDFC CIBIL score’s report and monthly updates on their credit scores, consumers can also try visiting online financial portals.

What occurs if certain mistakes are discovered on your credit report?

Any error on the part of your lender or the Indian credit bureau may have a negative impact on your credit score and your eligibility for future loans and credit card opportunities because credit reports contain the credit information provided by lenders and credit card issuers.

Report any errors, unforeseen transactions, or fraudulent activity to your lender and the relevant Indian credit bureau right away to make sure they are fixed. Following the correction process, your credit report will automatically show an updated IIFL CIBIL score.

It is suggested that you regularly review your credit report to avoid having your credit score affected and to make sure that any errors or instances of fraud are not missed. You will find it simpler to spot and fix any mistakes or potential frauds in your report as a result.

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