Secured loans were the only sort of loan available until a few years ago. The credit sector has changed dramatically with the introduction of unsecured loans.
What is Unsecured loans?
Unsecured loans are those for which the borrower does not have to put up any collateral. However, this necessitates further due diligence on the lender’s part.
A credit score is one of the most significant criteria for such unsecured loans. A credit score reflects a person’s ability to pay back debt. The following information is used by different credit institutions to compute your credit score:
Credit Score Checking Criteria
Type of credit
Repayment of loan installments
Number of outstanding loans
How long you have had an outstanding loan?
Payment of credit card debt
Hard inquiries on your credit reports
The score is calculated differently by each credit union. The information given by financial organisations is frequently used to generate credit scores. CIBIL TransUnion’s CIBIL score is one of the most widely used credit scores in India.
Your credit score is a 3 figure based on a scale of 900. The higher your credit score, the more likely you are to get approved for a loan, particularly unsecured loans like a personal loan.
How to Check Your Free CIBIL Credit Score Online
The process for checking your CIBIL score is fairly straightforward if you have never done so before. Your CIBIL score is checked entirely online. On the CIBIL website, you can even acquire a free CIBIL score. The first step is to fill out a form on the CIBIL website. The form necessitates information such as:
Credit Score Check Criteria
After you’ve entered these details, CIBIL TransUnion will send you a One Time Password (OTP) to confirm your identification. If the OTP fails, they may contact you to obtain additional information. It’s important to note, however, that this additional information will not include your bank account information or PIN. If anyone phones you seeking that information, report them since they are phishing calls. To offer you with any service, no financial institution requires your bank account number or PIN.
The next stage is to respond to queries about your credit card, outstanding loans, and other matters. Your CIBIL score will be determined using this information.
If you’re applying for a loan, though, it’s a good idea to maintain track of your CIBIL score. There are three other credit agencies where you can check your score besides CIBIL.