Your CIBIL Score is an important parameter that your banks consider to decide on how much loan you are actually eligible for. Your CIBIL score is an estimate of your ability to handle debt funds responsibly. This is a score of your reliability as well. CIBIL score is marked anywhere from 300 through 900.
There are different types of loans you might avail as an individual. These loans include, but are not limited to home loan, car loan, credit card loan, jewel loan, mortgage loan, personal loan, business loan, and more.
You might buy these loans from different lenders. With one lender, you might have an excellent credit repayment record and with another lender the situation can be different.
When you approach a bank seeking a loan, they check in to your CIBIL score. They check in to how your payment patterns are. They check in to the transitory status of your repayment with different lenders. Considering all these factors, they build a picture of your credit worthiness.
Technically, the credit score speaks for your credit worthiness. So, when you apply for a loan or credit card, your lenders check your credit score with the CIBIL.
All lenders submit the repayment history of their clients to CIBIL on a monthly basis. Based on the reports from your different lenders, CIBIL drafts your credit score.
Your credit payment history in CIBIL is documented as:
CIBIL score is very important for unsecured loan where the loan is released without collateral. Even in cases of a secured loan, this matters in a great deal. A bad CIBIL score is not the end of the world. You can repair it by fixing your debts. Just that you have to get disciplined about your credit usage.