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How CIBIL™ Score Can Impact on Your Loan Interest Rate?

A CIBIL™ credit score is a three-digit number that determines whether you have been responsible with your credit, for example, paying credit card bills on time, utilizing your credit card smartly and paying your loan EMIs regularly. Banks and NBFCs will check your CIBIL™ credit score to determine whether you are credit eligible for the credit(loan or credit card) that you have applied for. Credit scores range between 300 and 900. As per CIBIL™, if your credit score is above 750, you are more likely to qualify for a loan. The higher your credit score the more are your chances of getting approved for the top loans.

Having a good credit score would mean that you have been paying your credit card bills and loan EMIs regularly. This way, when lenders see that you have a good credit score, they would be assured with the fact that there is a low probability of you defaulting on EMI payments. Not only does your loan eligibility get better with a good credit score, you would also get low interest rates which would save you a lot of money.

If you apply for a loan with a low credit score, your loan application is likely to get rejected. Even if it gets approved, the interest rates will be very high. Instead of paying high interest rates, you can resolve your negative issues on your credit report and fix your credit score. But if you have a high credit score, you will get a loan easily and that to with the lowest interest rate offers.

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