CIBIL Score Tips: If your CIBIL score is bad, you will have to bear 5 big losses..
Everyone needs a loan at some point in life and in such a situation, CIBIL score is the most important for taking a loan. If your credit score is low or bad, then there are difficulties in getting a loan, many times banks refuse to give a loan, and even if you get a loan, you have to pay high interest. On the other hand, if your credit score is good, then you get a loan easily and you do not have to pay high interest. Many of your work can stop due to a bad CIBIL score. Yes, if your CIBIL score is down, that is, bad, then you may have to bear these five major losses.
What is the CIBIL score?
CIBIL score is a three-digit number that ranges from 300 to 900 points. This number shows your eligibility to get a loan. This number is decided based on your old loan, or credit card bill. When you pay the EMI of your old loan or credit card on time, it improves your CIBIL score. On the other hand, if your loan EMI bounces and the bank puts you on the list of defaulters, then in such a situation the CIBIL score becomes bad. After which you have to face many problems.
What are the benefits of a good CIBIL score?
If you have a good CIBIL score, you get many benefits. Whenever you suddenly need a loan, you can easily get a loan from the bank at a low interest rate. Sometimes there are even chances of getting a pre-approved loan offer and you can also get the facility of instant loan i.e. money coming into your account in a few minutes.
Disadvantages of CIBIL score going down -
Often people have this question in their mind if the CIBIL score goes down, then what are its disadvantages? First of all, when there is a sudden need for a loan, then the banks refuse to give the loan. Even if you get a loan, you have to pay a high interest rate (loan interest rate hike). You may face problems in many bank-related works. Apart from the loan, you may have to face these five losses if your CIBIL score is bad. Let's know about them -
1- There will be problems in getting a loan
If your credit score is low or bad, then in such a situation it becomes difficult for you to get a loan from any bank, small finance bank, or NBFC. In such a situation, banks are afraid that your CIBIL score is bad, that is, you can bounce the loan installment (EMI) or default on the loan.
2- You will have to pay more interest
It is not that you will not get a loan if you have a down CIBIL score. Yes, some banks agree to give a loan despite a bad CIBIL score. But in this situation, the bank charges more interest from the customer. They try to manage their risk. They think that if the borrower bounces one or two installments of the loan in the end, then the bank should not suffer a loss, so the interest rate is kept high.
3- You may have to pay more premium
Many times insurance companies can also ask for more premium from you when the CIBIL score is bad. Actually, in such a situation, insurance companies feel that you can make more claims, so they can ask for more premiums. Many companies can even refuse to give insurance.
4- There will be problems in taking any kind of loan
If the CIBIL score is bad, then you will have to face problems in taking any kind of loan. If you take a home loan or car loan, then you may have to pay more interest. If you want to take a big loan for business, then in such a situation the company can also ask you to mortgage the property in exchange for giving the loan.
5- You will get a loan late
Most importantly, sometimes we suddenly need money and in such a situation we need a quick loan from the bank. But if the CIBIL score (CIBIL Score Update) is bad then the bank can delay giving you the loan. They will investigate the documents thoroughly before giving you the loan. Even if you apply for a gold loan or securities loan, there will be a thorough investigation. Even if you agree to mortgage some property in exchange for the loan, the bank will not trust you and will investigate thoroughly. All these things can take a lot of time and you may get a delay in getting the loan.
Disclaimer: This content has been sourced and edited from Hr Breaking. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
