A Good CIBIL Score Can Help Process your Home Loan Application Faster
Rohit and Varun were childhood friends, who had managed to stay close despite different career paths and life choices. Rohit became a Chartered Accountant while Varun chose to pursue Advertising. When they both celebrated their 35th birthday, they decided that the time was ripe to buy homes of their own. Rohit chose a 3-bedroom apartment in a gated community while Varun chose a 2-bedroom stand-alone home. The value of their chosen properties coincidently came to almost the same amount. The two friends applied for a Home Loan individually and were confident of getting approval. They ended up applying to the same lender on the same day and though Rohit’s Home Loan was sanctioned in two days, Varun’s sanction took a week. While their income was almost the same, and their age and other particulars also comparable, what led to Rohit’s Home Loan being approved faster than Varun’s? It was Rohit’s good credit history that set him apart from his friend who had a bad CIBIL score.
A good credit score can therefore be one of the determining factors in getting you a faster Home Loan of a larger amount. Here’s everything you need to know about it.
What is a CIBIL Score?
A CIBIL score basically examines your credit history, taking into account your repayment history, credit balance, how prompt and timely you are with your credit repayments, your outstanding debts, your EMI to income ratio and your credit mix. All this information is part of your Credit Information Report and adds up to a three-digit number between 300 and 900. The higher your score is, the better your credit history. This score is used by your lender not only decide to sanction or deny your Home Loan, but also to estimate the loan amount and the interest you will be charged.
You can check your Home Loan Eligibility by visiting CIBIL website and pay a fee to carry the process forward.
Why is a CIBIL Score so Important in Availing a Home Loan?
Here are 3 reasons why maintaining a good CIBIL score is highly important to ensure getting a Home Loan faster and of a higher amount:
- It Reflects Your Bankability: Before a lender approves your loan, it checks your CIBIL score. This gives the lender an idea of your credit history. If you, for example, have a good credit score, it means that you have paid your earlier debts on time and haven’t delayed your EMIs or defaulted on a repayment. This gives your lender confidence in you as a borrower and thus leads to an approval of your Home Loan application.
- It Gives You the Power to Negotiate: If you have a good credit score, you will have the ability to negotiate with your lender in terms of the loan amount and the interest. With a bad CIBIL score, you lose the power of being viewed as a valued customer and instead have to settle for what the bank offers you.
- Reveals Your Financial Background: A good CIBIL score is key in getting your Home Loan approval faster since its works as the best kind of background check. With a good credit history, your lender can process your application quickly without spending too much time going through other details of your application, while the opposite is true in case of applying for a Home Loan with a bad credit.
Thus, though the lender sanctioned Varun a Home Loan too, Rohit’s application was processed faster because of his good CIBIL score. Rohit also ended up getting a higher loan amount compared to Varun. See where you stand and check your Home Loan Eligibility.
While thinking about your Home Loan, make sure to consider Bajaj Finserv, which offers Home Loans starting from Rs 30 lakh with interest rates starting from 8.85%. Dream big and apply for a Home Loan best suited for your needs!