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A credit score is a 3-digit numerical expression credit bureaus calculate based on people's credit histories. India has four credit bureaus – CIBIL, Equifax, Experian, and CRIF Highmark – that keep records of each Indian citizen’s credit accounts and see how responsibly they handle their credit. If you pay your loan EMIs and credit card bills on time, have a diverse mix of credit accounts in your portfolio, have minimal outstanding credit balances, and have a long history of handling credit responsibly, you will build a good credit score over time.
In the following sections, let’s explore everything you need to know about credit score, how to check credit score, its importance, benefits, factors affecting it, and other crucial details.
Those of you thinking, “How do I check my CIBIL score for free?" can follow these steps:
Besides this, you can also use a CIBIL score calculator on a lending institution’s website to check the CIBIL score online. However, ensure it is an authentic and trustworthy website with advanced security measures to keep your financial details confidential. Those with questions like “When should I check my credit score?” can check it before applying for credit to measure their current eligibility.
When you apply for a loan or credit card, financial institutions like Hero FinCorp check your credit score online to determine your creditworthiness and the risk of default in lending money to you. While the CIBIL score ranges from 300 to 900, anything above 650 is considered good enough to build credibility and attract lucrative loan offers. These are the common credit score ranges worth knowing:
Everyone suggests checking your CIBIL score regularly. Here are the reasons why doing that is important:
Since lending institutions check your consumer CIBIL score to assess your creditworthiness. It is essential to have a good credit score before applying for a loan. A high credit score demonstrates responsible credit behaviour, making potential lenders more confident in approving your loan requests. You also get other benefits like:
A low CIBIL score indicates high-risk credit behaviour, leading to the following consequences:
Credit bureaus calculate your credit score based on several factors, including the following:
Although it is not an overnight process, here are some practical ways to improve your credit score fast:
Once the credit score reaches a decent mark, follow these tips to maintain it there:
While most loan companies want to know your CIBIL score while evaluating your credit application, here are a few benefits associated with a high credit score:
CREDIT REPORT | CREDIT SCORE |
The credit report is like a credit history summary that credit bureaus calculate based on your credit accounts, repayment history, and overall credit behaviour. | A credit score is a 3-digit number that you get based on your credit report. |
The credit report acts as a credit reference, based on which the credit bureau measures your credit score. | Most lending institutions check CIBIL scores to measure your credit risk as an applicant. |
The credit report is a standalone document credit bureau creates based on your credit history. | You get a CIBIL score solely based on the data available in the credit report. |
You can request a copy of your credit report from the credit bureau only. | You can check your free credit score at the credit bureau’s website or a third-party entity or NBFC. |
One credit bureau provides one free credit report in a year. Additional procurement of credit reports attracts charges. | You can check your free credit score online any number of times without restrictions. |
A credit bureau is a data collection agency that gathers information about an individual's credit history and payment records from various credit accounts and makes it available to creditors. Also known as credit reporting agencies, they work in two ways:
The Reserve Bank of India has authorised four credit bureaus to collect credit-related activities of Indian citizens:
When you apply for a loan, your financial institution will approach a credit bureau to obtain your credit report and evaluate your loan application.
Hero FinCorp is a best-in-class provider of financing solutions for your NEW used car.
We finance both certified and non-certified cars of any make, model or variant.
Our loan products are available for Salaried, Self-employed individuals and business owners.
We have range of used car products :
Used Car Loan
Balance transfer of Car Loan
Loan Against Car
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Flexible Repayment Options
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Doorstep Service - Stay at Home, Get Finance
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*Terms & Conditions Apply
Are you planning to buy your NEW used car? Then Hero FinCorp's Used Car Loans are your best choice.
We offer a wide range of cost-effective used car loan options, for both certified and non-certified cars. Our financing solutions feature multiple repayment options (PDC, NACH, ECS, etc.), flexible tenures and attractive interest rates.
We begin by understanding your financial needs, and then offer solutions best suited for your requirement.
At Hero FinCorp, we believe in providing prompt service and building strong & lasting relationships.
Our goal is to help you achieve all your dreams and aspirations
Take advantage of our low introductory interest rates and fantastic customer service.
Do you have a car and looking for a personal loan ? And do you need cash for your business or looking for more liquidity? Loan Against Car can help solve all these problems!
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A second-hand car loan EMI calculator enables customers to calculate the EMI that they will be required to pay towards the loan repayment over a specified term. By using a second-hand car EMI calculator, you can determine the suitable repayment tenure to comfortably pay off their loan for a used car. The calculator makes it simple to plan your budget so that you do not fall behind on your EMI payments.
To avail of a used car loan, you must fulfil certain eligibility criteria:
Age | One should be an Indian citizen with a minimum age of 18 years and the maximum age of 60 years for salaried individuals and 65 years for self-employed, by the end of the loan tenure. |
Occupation Status | The applicant should have been in a stable job for at least 1 year. In the case of self-employed, the applicant should have been in the existing business for at least 1 year. |
Loan Tenure | The loan is available for a minimum tenure of 1 year and the maximum tenure of 5 years. |
Loan Amount | A loan for a used car is available for a minimum amount of Rs 50,000 to the maximum amount of Rs 50 lakhs. The maximum LTV on a used car loan is 90%. Top-up loan of up to a maximum LTV of 175% of the used car loan value. The LTV ratio or maximum loan amount depends upon various factors such as the applicant's profile and car's condition. |
Monthly Income | There is no such predefined monthly income. |
Before applying for Before applying for second-hand car financing, applicants must have the below-mentioned documents ready for submission. , applicants must have the below-mentioned documents ready for submission.
Mandatory Documents | Application Form Vehicle's Registration Certificate |
Identity Proof | Passport/ Aadhaar Card/ Driving Licence/ Voter ID Card/ Photo ID issued by GOI/ Job Card issued by NREGA |
Address Proof | Aadhaar Card/ Driving Licence/ Voter ID Card/ Utility Bill/ Lease or Rent Agreement/ Letter issued by National Population Register containing Name & Address Details |
Office/ Business Proof | Utility Bill/ Sales Tax Regi./ VAT/ Excise/ Service Tax Registration/ Establishment and Shop Registration Certificate/ MSME or SSI Registration Certificate/ Registered Lease Agreement |
Age Proof | Passport/ PAN Card/ Driving Licence/ Birth Certificate. |
Occupation Proof | For Salaried: Appointment Letter/ Joining Date on the Salary Slip/ ITR/ Form 16/ Experience Certificate/ Relieving Certificate. For Self-Employed:Shop & Establishment Registration Certificate/ SSI or MSME Registration Certificate/ Sales Tax/ VAT Registration |
Signature Verification Proof | Passport Copy/ Banker's Verification/ PAN Card |
Income Proof | Latest Salary Slips/ Bank Statement/ Form 16/ ITR/ Audited Balance Sheet/ P&L Statement |
Taking loans and credit cards and paying their EMIs and bills on time is the best way to build your credit score fast.
Paying all credit card bills and loan EMIs on time, maintaining a low DTI ratio, and reducing the credit utilisation ratio are the sure-shot ways of maintaining a good credit score.
Information about the credit accounts you hold, along with your repayment history and closure details, are some crucial information required to check your credit score.
Request a CIBIL report download from the website of the preferred credit bureau. Check and identify errors, discrepancies, or incorrect information in the report and email the credit bureau mentioning the error. The credit bureau will confirm the information and update the report after correcting the mistake.
Yes. Skipping even a single credit card bill payment can affect your credit score negatively. Repayment history is one of the biggest factors affecting credit score.
Usually, you can check your CIBIL score by PAN card only. However, if you don't have a PAN Card, you can check the score using your passport, driving license, or voter ID.
Providing incorrect details while checking credit scores is common. If you do that by mistake, email it to the credit bureau's notice as soon as possible and request a correction.
Checking the CIBIL score on a third-party website is usually safe, provided it is the website of a reputable lending institution which does not ask for unnecessary information.
No. Checking your credit report does not hurt your credit score in any way. Instead, doing that is advisable to keep the score in good health.
The CIBIL score ranges from 300 to 900. The higher the score, the better it is for an aspiring borrower. A CIBIL score of 650 or above is ideal for Personal Loan approvals.
Apart from CIBIL, the credit bureau, and any financial institution from where you apply for a loan or credit card can access your CIBIL report. They can freely check your CIBIL score online to determine your credit history and loan eligibility.
Yes. Loan EMI payments are major contributors to your credit score. Missing them can reduce the score by a few points and affect your future loan eligibility.
Getting errors corrected in the credit report, paying off outstanding balances, and minimising the credit utilisation ratio can raise the credit score by a few points in 30 days.
No. You cannot reset your CIBIL score. However, improving it is possible with responsible credit behaviour and regularly checking free CIBIL scores online.
The older CIBIL version did not provide scores to first-time borrowers with zero credit history in the past six months. CIBIL 2.0 measures such people’s credibility based on a different score range.
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