Home loans
are a popular option for house buyers today, especially with the rise of the
EMI method of payment. Many developers offer home loans and EMI by themselves
to make the process that much easier. When a buyer applies for a home loan, the
housing finance company/bank/developer will go through various stats, readings
and general information of the applicant.
CIBIL stands
for Credit Information Bureau Limited, which is India’s first company of its
kind. It procures and updates
information for banks and the like on a monthly basis in reference to an
individual’s monetary records such as credit card usage and loans. CIBIL also
provides a CIBIL TransUnion score that shows an applicant’s credit and
financial health. This information is used by banks to create Credit
Information Reports (CIR) which when combined with CIBIL TransUnion scores, aids
in deciding whether the applicant should be given a loan or not. Therefore, it
is very important to score well in the Credit Information Report and the CIBIL
TransUnion score.
A low credit
score (below 700) will mean your application is not even considered, while a
high score above 700 will mean your loan is sanctioned. A good score will mean
better interest rates and relative ease in all the bank related procedures. It
makes it that much simpler to procure a housing loan. As a precaution, get a
credit report done in advance. If it is low, there are various agencies that
help you improve it. Since the credit score reflects on payments and data from
the past, it is important to ensure that you pay your bills on time. If there
was a genuine reason for defaulting on a payment, you can contact CIBIL and get
a fresh report.
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