Find out the credit score required for a home loan in India.
Know the credit score required for a home loan in India by reading the information below.
People are thinking of buying homes, but not all of them can afford to pay it in cash. This is where the home loan companies will come. Unfortunately, getting a home loan is not easy since most lending companies have a credit score required for a home loan in India. Below are some of the information that you need to know.
Credit Score Required
According to the data of CIBIL, 80% of the people who get approved are the ones with a 750 and above score. But of course, everything will depend on the lending company and the bank itself. For instance, HDFC and ICICI Bank, their required credit score is 640, while for India Bulls and DHFL their required credit score is 550.
Low Credit Score
If you are trying to get a home loan but is worried about the credit score that you have, you can always go to other financial institutions that are non-banking since they are known to be more flexible. In fact, some of them have already granted a loan for people who have a credit score of 360.
What is a credit score in India
Familiarize yourself with a credit scores in India by reading the information below.
CIBIL is India's credit information company, which collects and maintain all the information on an individual's credit card and loan. Find out more about credit score in India below.
Credit Score Range
The credit score ranges from 300 to 900, wherein the closer your score is to 900, the more confident the lending company is with you when it comes to granting you your loans. If your score is less than 750, most lending companies will see you as high risk, which can lessen your chances of getting approved.
Benefits of Having Good CIBIL
There are a lot of advantages of having good CIBIL, such as getting a higher amount of your loan, lower interest rate, and a fast approval of the loan. Some companies will also give you a longer repayment period, which means lower monthly dues for you.
How are credit scores calculated in India
In India, credit score is calculated by Credit Information Bureau of India Limited (CIBIL) which first started collecting borrower's information. It is also known as the CIBIL TransUnion score which is measured in a range of 300 to 900. Closest to 900 shows better creditworthiness and little probability of the creditor defaulting on his or her payments.
The CIBIL TransUnion score is based on five factors. First, is the applicant's repayment history which accounts for 35 % of the total score. Second is the credit balance which accounts for 30 % of the credit score in India. Followed by the amount of time for credit use which is responsible for 15 % of the rating on your CIBIL score. Final 10 % is for your overall credit mix.
The CIBIL score that is calculated using the weights mentioned above is responsible for approval, disapproval or the type of credit when you apply for loans in India.
Explanation of credit score ranges in India
A lot of people are wondering about the explanation of credit score ranges in India. Let's find out by reading the information below.
The credit score in India ranges from 300 to 900. The higher your score, the easier it is for credit companies to trust you. You can easily get a loan or a credit card without providing too many requirements.
A Good credit score
A good credit score ranges from 750 to 900 and most banks and financial institutions see people who have this score as low risk. This means that they are comfortable in approving credit card or loan applications to these people.
A Bad credit score
A bad credit score ranges from 300 to 749 and banks and financial institutions see people who have this score as high risk. They usually require more requirements before granting them their applications.