How a Strong CIBIL Score Can Help Home Loan Borrowers This Festive Season

Blog Post10/28/2022
Credit Advice

For home loan seekers looking to build their credit health and improving their CIBIL score, here are a few things to do.

Your CIBIL score is not just a number, it is a powerful tool that will help you get access to faster and cheaper credit.

A home is much more than just walls and a roof. Buying a home is probably one of the most important emotional and financial decisions you’ll ever make. Whether it is to start your new family, or plan your retirement get-away, we all wish to move a step closer to buying our dream house. To share a perspective on how this festive season impacts the buying decisions of Indians, over the last 1 year, amongst borrowers who monitor their own CIBIL Score, 58% were first-time home buyers. In 2021, amongst the self-monitoring* borrowers, about 45% were below the age of 35 and around 82% of the home loan borrowers had a CIBIL score of above 720.

Looking at these numbers, we can see that with higher disposable incomes, availability of easy credit choices and offers, a home purchase appears as an attractive proposition for many Indians. Additionally many banks are rewarding good credit behavior and have announced home loan rates starting at 6.5% across loan slabs and for all customers having higher credit scores of 750 or above. These rates are a part of the festive scheme for several public and private banks.

Your CIBIL Score and Report is a reflection of your credit behavior and a positive credit profile plays a role in getting access to loans. For home loan seekers looking to build their credit health and improving their CIBIL score, here are a few things to do:

  1. Evaluate your CIBIL Report and pay close attention to the details:

This is probably the easiest and most important step for any home loan seeker. Monitoring your CIBIL Score and Report regularly ensures accurate information and thereby helps maintain a healthy credit profile. Checking your report also enables you to protect yourself from identity theft by tracking changes in your report.

  1. Maintain a healthy credit record:

Paying all credit dues on time, every single time can go a long way in showcasing a responsible behavior and creating a positive credit profile. This will eventually help in increasing your credit score and thereby gives you an easier and faster access to home loan at better rates.

  1. Be credit wise and monitor credit inquiries:

Research and plan before you apply for a home loan. Avoid applying for home loans from multiple banks/lending institutions at the same time. It is advisable not to appear credit hungry. Hence, make credit/loan inquiries smartly.

  1. Utilize credit cautiously:

Keep a close watch on the credit utilization ratio. Check all details with regards to your credit card utilization before you apply for a home loan.

  1. Managing co-signed/guaranteed loan accounts:

Any missed payments on a co-signed/guaranteed loan account can impact your credit score and profile too. Monitoring these accounts regularly ensures your credit score is not affected by someone else’s negligence.

In essence, your CIBIL score is not just a number. It is a powerful tool that will help you get access to faster and cheaper credit. A positive credit profile and a strong CIBIL Score is the first and a crucial step towards your journey to financial independence.

Stay credit-ready by monitoring your CIBIL Score & Report.

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Disclaimer: The information posted on this blog (Information) is prepared by TransUnion CIBIL Limited (TU CIBIL). This Information is for generic informational purposes only and is meant for consumer education and awareness about credit scores, credit history and credit reporting. The Information posted on the blog does not constitute credit advice and the user will need to consider the same and take independent informed decisions . No part of this Information may be quoted out of context, distorted ,distributed, published and/ or reproduced in any form and manner whatsoever. Consumers are advised that the Credit Information Reports (CIRs) prepared by TU CIBIL are based on collation of information, substantially, provided by credit institutions who are members with TU CIBIL. TU CIBIL is not responsible and /or liable for errors and/or omissions caused by inaccurate or inadequate information submitted to it by credit institutions. TU CIBIL does not guarantee the adequacy or completeness of the Information and/or its suitability for any specific purpose nor is TU CIBIL responsible for any access or reliance on the Information. TU CIBIL expressly disclaims all such liability. Further, this Information is based on the data available with TU CIBIL at the time of publication and therefore may not be up-to-date.