How Your CIBIL Score Affects Your Car Loan

By | December 4, 2015

How Does Your CIBIL Score Affect Your Car Loan

Amit was reading two car brochures at the coffee table. He had a frown on his face as he compared the features of the Maruti Swift’s different models with the Hyundai i20. He was confused over whether to choose the model with airbags or one without. The Swift with the airbags came with a steering-mounted entertainment console. But the i20 was also a good car. The price range was similar too. Which car to choose?

We know planning to buy a car is a tough decision.  It is hard work, contemplating the price, comparing features and even the different colours.

Have you checked every detail? Have you checked your CIBIL score?

Did you know that the most common reason for rejection of Car Loans is a poor CIBIL score?

Why Your CIBIL Score is Important for a Car Loan

Did you think your CIBIL score is considered only when you apply for a Personal Loan or Credit Card? Well, your CIBIL score is an important factor for any loan.
Banks run a background check on your Credit Score to ensure that you will repay the loan entirely and not end up as a Non-Performing Asset.

So remember to check your CIBIL score before applying for a Car Loan. How, you ask? It’s easy.

Check Your CIBIL Score

  • You can check your CIBIL score by applying online at the CIBIL website.
  • You need to submit your identification documents including your PAN Card.
  • The fee for the CIBIL score is Rs. 500 which can be paid online.

After your application is submitted, you can expect your CIBIL score in 3-4 business days.

An Ideal CIBIL Score for a Car Loan

There is no ideal CIBIL score to be eligible for a Car Loan. CIBIL scores range between 300 and 900, where 900 is considered to be most secure and 300 the least secure. A CIBIL score above 750 is considered safe by most lending institutions and banks.

Useful Tips to Remember When Applying for a Car Loan

  • Stay ahead by using some of the various Car Loan eligibility tools available to check whether your loan would be approved or rejected – try!
  • A rejected loan would negatively impact your CIBIL score.
  • Avoid applying for a Car Loan with multiple banks. This would make you seem like someone who is desperate for a Car Loan and would put you in the category of possible defaulters.

Got a Low CIBIL Score? Don’t Worry

There are ways in which you can improve your CIBIL score. You could find out the reasons for your low CIBIL score and work towards improving it before reapplying for a Car Loan.

Are you ready to explore the best Car Loans?

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