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What is the CIBIL™ score needed for an HDFC Home loan?

The bank requires the applicants to have a minimum credit score of 700 to be eligible for their home loans.

Home loan is often the largest liabilities of any person. Hence, the eligibility criteria set for such loans is also quite stringent. Lenders ensure that a home loan is sanctioned only after the applicant has met all the required eligibility criteria set by the bank. This assures the bank of the viability of the loan and reduces any chances of Nonperforming assets (NPAs).

HDFC Bank has set many eligibility criteria for the applicants to be qualified for the home loan of the bank. These eligibility criteria include many factors like,

  • Age of the applicant
  • Income of the applicant
  • Relationship with the bank
  • Employment status of the applicant
  • Work experience

Apart from the above-mentioned parameters, the bank also checks the credit score of the applicant as part of eligibility conditions.

A credit score lower than 700 is not considered to be a good credit score by the bank. Such candidates having a credit score lower than 700 are considered to be high-risk candidates for home loans.

The bank may sanction a home loan to an applicant having a credit score lower than 700. In such a case the eligibility will be determined on other factors as mentioned above. The key point of consideration in such cases will be the income of the applicant.

If the applicant can prove the repayment capacity for the loan and has a healthy past relationship with the bank, the loan may be sanctioned at the bank’s discretion. The bank may review the existing external liabilities along with the income parameter. The other parameter considered by the bank is the net take-home of the applicant. If it is less than 50% of the gross monthly pay after considering the external liabilities and the proposed EMI for the loan, that can be another basis for rejection of the home loan.

About HDFC Home Loans

HDFC Bank is one of the top lenders in our country. The bank has provided many unique and modern banking solutions for its customers within the country as well as overseas. These products include various types of loans that can be available to applicants based on their eligibility. The multiple loan variants of the Bank include personal loans, car loans, home loans, business loans, education loans, etc.

The home loans of the bank are among the preferred loan products in this segment. Apart from the many eligibility criteria set by the bank, the credit score of the applicant is one of the main factors that influence the loan application of a person.

The Role of CIBIL™ Score for an HDFC Bank Home Loan

CIBIL™ is one of the four credit rating agencies that are available in India. The other credit rating agencies that provide credit score for the applicants are,

  • Equifax
  • Experian
  • CRIF Highmark

HDFC Bank refers to the credit score issued by CIBIL™ while reviewing a loan application. The credit score issued by CIBIL™ ranges from 300 to 900.

A credit score is the evaluation of the creditworthiness of a person and is based on the credit history of the applicant. According to the recent changes made by RBI, every credit rating agency including CIBIL™ has to mandatorily provide the benefit of a free credit score once a year. This credit score can be checked online by the applicants through the website of CIBIL™. The inputs for checking the credit score issued by CIBIL™ is mentioned below.

FAQs on CIBIL™ score for HDFC home loan

1. What is the minimum credit score needed for the sanction of an HDFC home loan?

A. The minimum credit score needed for an HDFC home loan is 700.

2. What are some of the common factors that can lead to the rejection of a home loan application of a person?

A. Some of the common factors that can lead to rejection of home loan application of a person are mentioned below,

A low credit score of a person

A lower credit score of a person is one of the biggest reasons for the rejection of the home loan application. HDFC may, however, provide home loan at lower credit score but such sanction will be only at the discretion of the bank.

Low income of a person

When the bank feels that the income of the applicant is not sufficient to support the EMI of the proposed loan, the loan application of the applicant can be rejected.

Less or no work experience

Work experience or employment status is one of the main considerations for home loan eligibility. Such criteria are to be fulfilled to ensure that the applicant is capable of repaying the loan in full without any foreseeable defaults. When the applicant does not meet the work experience and the employment conditions set by the bank, the loan application of the applicant can be rejected.

Submission of incorrect details in the application form

The application form for the home loan application has to be filled in correctly and with due care. Any error in filling the home loan application form or wrongful submission of details can lead to the rejection of the home loan application of any person.

Non-compliance with the age criteria

HDFC bank has set specific age criteria for the applicants to be eligible for the home loan. When the applicants do not meet the age criteria, it leads to instant rejection of the home loan application.

3. Can the credit score be affected if the borrower misses payments of loan instalments?

A. Yes. Non-payment of loan instalments will directly affect the credit score of a person.

4. Can part payments of a home loan affect the credit score of a person?

A. Yes. Part payments of home loan have a positive effect on the credit score of a person.

5. What is the range for the CIBIL™ score?

A. The range for the CIBIL™ score is from 300 to 900.

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