How to check your credit score?

How to Check Your Credit Score?

In this world of the internet, everything is possible. From paying your gas bills to checking off your loan repayment or even how much credit score you have, everything is near our face and at the palm of our hands. Earlier it was a huge deal to check your credit score because people had to get permission from their respective banks and get the work done. But this is not the case anymore. If you can sit at the comfort of your own home and create an account, you can check your cibil score or credit score if you have a laptop, a desktop and even your mobile phone with an active internet connection.

So why you need to check it?

Lenders are always trying to fish into your credit score. Your credit score matters to you, and even when the time you are obtaining personal or home loan. Your credit score is the primary determinant as to how fast you will get your loan right on time.

Whether you have a credit card or you have opted out for a mortgage, your credit score will follow you everywhere you go. So it becomes practically inevitable for you to escape from the worst which could happen. It is a score that reflects on your credit track record, and the more you make your payments on time, use the better or lesser loan, etc., the better your score will be.

So how can you check your credit score?

If you want to check your credit score, then you have to go through the CIBIL check. You might think that this is yet another complicated term up in your way, well it is not.

CIBIL means Credit Information Bureau India Limited. It is leading credit rating agency which helps to keep track of all your credit transaction and records. It helps to shine a light on your creditworthiness as well.

Due to the presence of CIBIL, the people of India are financially stable now and can check off their credit rates on the online. It has managed to make the financial markets permanent with the knowledge of educating the people to what they want and how they should process their spending. It is because of CIBIL that the financial market is transparent.

And it has sown a structure for the Indian people to rely on so that they can do the best for themselves and make sure that they can manage the risks as well as control their lousy loan from the bank that they are taken their amount in.

Also read: 10 Best Credit Cards in India [With Exploding Benefits]

How do the CIBIL works?

When you want to check your credit score from the online source, then you have to take the help of the CIBIL here. Banks and financial institutions from all around will first get their access through the CIBIL before they grant you any loan.

The CIBIL check which is done is based on the generation of the credit score. It is a three-digit number which works and ranges basically from 300 to 900. If you have a credit score below 300, then it is said that it is inferior. This is when the lenders will often time hesitates before granting you the personal loan. The next thing is if your score is around 900, then it is ideally the best credit score that you can have.

credit score range

(Source: NerdWallet)

Every month, all the banks and the institutions that grant your credit will check off your CIBIL score to understand how they can give you permission for certain things. This, in turn, helps the bank and the employees to judge your credit rating and choose the right applicants for granting the loan amount.

This way, they can get the repayment right off the bat without having to put a second thought to it. If the banks and the financial institutions are checking your credit score, then you need to make sure that your score should be above 700. If it is below that, then most of them won’t avail you to make usage of their service that they have.

Also read: Everything You Need to Know About Your Credit Score.

Steps to check off your credit score

Here are the steps you need to follow if you want to check off your credit score with the help of the CIBIL records. 

  1. You need to initiate the whole process by filing for a form which is present onto the official site of the cibil website. If you have filled up the way, then it will be right for you and easy for you to check off your credit score too.
  2. Now you need to enter your personal details. This is your name, your phone number, your address, etc.
  3. If you want to opt-out for the CIBIL Transunion score or which is also known as the CIR, you have to pay a nominal fee for the same.
  4. Once you have submitted your form, and with the nominal fees, your credit or your CIBIL score will be mailed to you.

For those who have not yet found to work out through the internet life, you can check your credit score with the help of the offline function too. You need to fill in the form of application and then bring in your documents to the official CIBIL office which is located in Mumbai, and your work will be done. It will help you to understand your credit score better.

Now here is some trick you need to know before you apply in for your credit score check through CIBIL. 

  1. Checking CIBIL score is FREE. You will be firstly offered a lot of paid options if you are trying to check off your score. If you want to check your score of once then you can click onto the No thanks option which is located at the bottom.
  2. If you don’t have your account, then you have to make one but If you do have then you can log in using your password and username. For those who are creating their account for the first time, they will be prompted to open an account with a pseudo password. Once you have opened the same, you will be mailed to change your password ASAP.

Note: If you are yet to get a credit card, here is a quick link to check your eligibility and apply for credit cards online.

Check your credit score for good

If you ask me, it is not advised to check your credit score only once because it can fluctuate over time. Check your credit score every quarter or six months. So if you wish to keep an eye on your score, then there is a plan which you can select which is present onto the website. This way, you can save a check on them and help to maintain a good credit score with an overall well impact.

5 Things You Should Know Before Getting Your First Credit Card

5 Things You Should Know Before Getting Your First Credit Card.

5 Things You Should Know Before Getting Your First Credit Card:

Contrary to popular beliefs, the credit cards are not to be mistaken with “free cash” or else be ready to fall into the trap of endless repayment and paying penalties.

A Credit Card, if used rationally and in a balanced way, can be a huge gift for mediocre spenders as it allows you to spend on your necessities even if you are practically broke. However, be sure that you will be able to earn cash to repay the amount in time or else there will be penalties in your name. Looking for benefits associated with credit cards? Let’s help you out with a few scenarios:

1. Benefits Associated With Credit Cards:

  1. If you are not earning (or will not be earning) for a while, you can always pay your bills and pay for your necessities using a credit card assured if you can pay for the amount later.
  2. There are multiple rewards and cash backs that come with the use of credit cards on bill payments and even for shopping.
  3. Various credit card issuers provide you with insurance on your flight tickets and bus tickets.
  4. With a good credit history, you can apply for loans easily in any bank.
  5. Convenience is the middle name of a credit card as it allows you to pay for anything through a card and without requiring you to withdraw cash from ATM every now and then.

But with benefits, there come responsibilities and in this case the wisdom of rational spending. Let’s know things about credit cards to know more about it.

2. Credit Card Interest Rates in India

The interest rate varies from bank to bank in India. However, ICICI Bank is the leading issuer of credit cards in India. The interest rate keeps falling in the range of 1-3% for almost every bank that issues credit cards. Apart from the interest rate, there are other benefits associated with credit cards which have to be kept in mind before purchasing a credit card. For example:

Some banks offer free insurance on ticket bookings through credit card and others provide various cash backs on bill payments. These are a few factors that influence the mind of a buyer. The interest rate depends on the following factors:

  • Repo Rate: Repo rate is the rate at which the RBI lends money to the commercial banks of India.
  • Reverse Repo Rate: The rate at which the RBI borrows money from the commercial banks of India.
  • Repo rate directly influences the interest rate on credit cards whereas the reverse repo rate inversely influences the rate of interest.
  • Prime Lending Rate: Various banks fix the interest rate on a credit card keeping in mind the current prime lending rate.

3. Fees on Credit Cards:

There are times when a credit card issuer (bank) does not clear the terms and conditions for a credit card. The terms and conditions specify various fees that are to be charged before issuing a credit card to the holder. The fee structure is as follows:

  1. Joining Fees: These days, many credit card issuers are issuing credit cards without associating any joining fee to it which means that a holder can gain access to a credit card without having to pay any fee in the beginning.
  2. Annual fees: The free (or paid) credit cards issued are associated with an annual fee which has to be paid on a per year basis. Again, the annual fee to be paid varies from one bank to the other.
  3. Interest Rate: The main pointer through which a bank earns on credit cards is the interest rate that it charges on these cards. Generally, the interest rates vary from 1-3% in India.

4. Minimum Payment on Credit Cards:

In layman terms, the Minimum Payment is a scheme which allows you to settle a minimum amount on your overall (monthly) credit card bill if you are not able to pay the entire bill at once. However, the remaining balance which is carried forward for the next month is associated with a higher rate of interest.

Benefits: 

  • Save you from a penalty in case of “partial payment”.
  • Saves a bad mark on your credit history.

Disadvantages:

  • Interest-free credit period is not provided in case of Minimum Payment
  • Keeps you trapped in an endless loop of repayment.

Note: If you are yet to get a credit card, here is a quick link to check your eligibility and apply for the best credit card online.

5. How Credit Cards Affect Your Credit Score?

The credit card can hugely determine your credit score as it defines your immediate decisions and management of your debt. If you plan to balance out your spending every month, credit cards can have a huge positive impact on your credit score.

  • Your Credit Mix accounts for 10% of your FICO score
  • Closing Credit Card Accounts can hurt your credit score
  • Your Payment history (or late repayment) can hurt your credit score up to 30%
  • The amount of debt you carry can affect 30% of your FICO score.

Also read: How to Check Your Credit Score?