Credit Score Check: A Step-by-Step Guide

Credit Score Check: A Step-by-Step Guide

Your credit score is a reflection of your creditworthiness, which plays a crucial role in your loan and credit card approvals. Simply put, lenders are more likely to sanction your loan if you have high creditworthiness.

Therefore, it is extremely crucial to know your credit score and understand its significance before you apply for loans or credit cards.

If you are wondering how to check this score, we’ve got you covered. This post reveals a step-by-step process for credit score checks and other relevant details to help you out in this regard.

Let’s get exploring!  

Credit Scores: A Brief

A credit score is a 3-digit number that indicates your creditworthiness. This number ranges from 300 to 900. The higher your credit score, the better your chances of getting credit. 

Based on your financial history, your score is compiled by credit information companies that function under the licence of the Reserve Bank of India (RBI). There are four such companies in India: CIBIL, Experian, Equifax, and High Mark Credit Information Services.

Credit information companies compute your credit score by acquiring information from banks and financial institutions where you have applied for or availed of loans and credit cards. This information includes your credit history, repayment history, credit card bills, total outstanding amount, credit utilisation ratio, the number of credit lines you have availed of, and other related variables.

Benefits of Having a Good Credit Score

Your credit score is considered to be good if it is between 700 and 900. A good credit score can offer you several benefits when you apply for a loan or a credit card. Some of the major benefits include the following:

Banks and financial institutions will consider you as a creditworthy borrower. As such, they are more likely to approve your credit request.

Due to your high creditworthiness, you can get your loan or credit card at lower interest rates.

Your high credit score can enhance your chances of getting approved for higher limits on your credit cards or loans.

Basic Details Required for Credit Score Check

You can easily carry out a free credit score check by providing a few basic details. Following are the details that you generally need to share to check your credit score:

Your full name

Your date of birth

Your email id and mobile number

Your pin code

Your gender

Your ID proof, such as PAN number, Aadhaar number, passport number, or Voter ID

Steps to Follow for Credit Score Check

You can check your credit score online without paying any charges. One of the websites to do so is the official website of CIBIL.

Given below are the steps to follow for a free credit score check online on their official website.

Step 1: Visit the official CIBIL website.

Step 2: Click on ‘Get your CIBIL Score’.

Step 3: Create an account on CIBIL by providing the required details, such as name, email ID, password, PIN code, date of birth, and mobile number.

Step 4: Click on ‘Accept & Continue’.

Step 5: Enter the OTP sent by the website to your mobile number.

Step 6: Click on ‘Continue’.

Step 7: On the next screen, select ‘Go to Dashboard’.

Step 8: Click on ‘Member Login’.

Step 9: Enter your username and password and click on ‘Login’.

Step 10: Check your credit score.

What Does Your Credit Score Indicate?

Your credit score reflects your credit behaviour. You can interpret the result of your credit score check in the following ways:

A score between 700 to 900

Having a credit score above 700 is a clear indication of your high creditworthiness. Lenders are more likely to offer you credit at the best interest rates.

A score between 600 to 700

If your score is between 600 to 700, it means your credit record is good. However, you may have to pay a slightly higher interest rate compared to those with credit scores above 700.

A score between 500 to 600

When your credit score is in the 500 to 600 range, it places you in the average group. As such, lenders may offer you comparatively higher interest rates.

A score below 500

A credit score below 500 means you have poor ratings. Lenders are less likely to offer you credit. If they do, you may have to pay high interest rates. 

Tips to Maintain a Good Credit Score

Having a good credit score isn’t enough. You need to maintain a good score consistently. Here are a few tips to help maintain a good credit score:

Make it a habit to pay your credit card bills and loan EMIs on time.

Ensure that you pay your credit card bills in full.

Keep your credit utilisation ratio low, preferably below 30%.

Avoid closing your old credit cards.

Opt for a credit score check regularly to ensure your credit rating is on track.

Read More – Choosing The Right Bank: Factors To Consider For Personal And Business Banking

Final Words

Regular checking of your credit score is essential. It helps you to keep track of your credit behaviour and make improvements if needed.

This way, you will be able to maintain good credit behaviour and reap the rewards for that in terms of lower interest rates in the long run.

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