How to check your credit score

How to check your credit score:

One of the factors that determine whether a bank will lend to you or not is your credit score. To know the credit profile of a borrower, a bank gets the credit score and asks for credit report from the one of the credit bureaus in the country.

 As per the current Reserve Bank of India (RBI) guidelines the effective interest rate that will be charged on a loan taken by an individual from a bank will be calculated as follows:

External benchmark rate + spread (margin) charged by bank + risk premium

Different banks have different criteria for determining risk assessment for borrowers.

Some banks have their own internal risk assessment teams while other banks rely on the credit score of the borrower.

Even housing finance companies offer better interest rates for those with higher credit scores.

For instance, LIC Housing Finance announced a lending rate of 7.5 per cent for new homebuyers with CIBIL score of 800 and above.

1. What is credit score?

Credit score is a three-digit number denoting the creditworthiness of an individual. The credit report also indicates the credit behaviour of an individual by stating whether he pays his bills, equated monthly instalments (EMIs) and other dues on time.

 2. How to generate credit score?

 One can check the credit score via a credit bureau such as TransUnion CIBIL, Experian, Equifax and Highmark. Also we can ask/check from our Bank by paying official charges.

3. Are there any charges for generating credit score?

The charges for generating credit score vary from one credit bureau to another. As per RBI guidelines, the credit bureaus are required to provide a free credit report and credit score once a year between January and December.

4. What is the difference between credit score and credit report?

Credit score is a number which denotes the credit worthiness of an individual. On the other hand, credit report contains the detailed breakdown of an individual's credit history.

5. What is the range of the credit score?

 Credit score usually ranges between 300 and 850. An individual should remember that higher the credit score, higher will be the creditworthiness.


Online Procedure:

Free CIBIL Score and Report : From Credit Bureau Company by Visiting their Website.

Step 1: Create an Account

Create your own username and password. Enter your name, email ID and mobile number.

** keep your username and password safe! You can use these credentials to login & access Unlimited CIBIL Score & Report in the future.


Step 2:  Enter Personal Details

These would be your Date of Birth, Address, identity proof such as your PAN card and Aadhar number.

** Ensure you enter these details as they appear on your ID proofs.

Step 3: Verify Your Identity 

Credit Bureau Company  will send you an OTP to verify your details, or they may ask fr more details, just so that they know it,s really you.

** For faster authentication, keep all loan account details available (details of different accounts- Credit Cards, Home Loan, Personal Loan etc.) and ensure your mobile phone and email is handy.

Step 4: CIBIL SCORE AND REPORT

You will receive your report. You can download or keep in mail.

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