Missing a Single Payment Can Affect Your CIBIL Score

For you, it is quite important to learn about the difference between minor and major defaults to gain a better understanding of missed payments and their effect on your CIBIL score.

Your credit score may improve later in case of a minor default. You can check your credit score after some time to monitor the changes. Once your credit score improves, you can apply for a credit product and get your credit approved.

However, if there are numerous instances of such defaults regularly, it means that the borrower is not able to keep up with the repayments and thus would be considered very risky. Lenders would refrain from approving credit applications of such applicants.

A major default in a credit report may make it very difficult for you to improve your credit score. One major default would lower your credit score to such a level that it would be tough to raise it to 750 or above. It also makes the applicant less creditworthy and the risk factor is very high for lenders. Thus, most lenders refrain from approving any credit product of such applicants.

One can easily infer that under both scenarios the loan worthiness of a customer is hampered. However, it is important to note, that in case of a minor default, you can recover your CIBIL score which is almost impossible in case of a major default.

If you have missed a payment due to any sort of financial emergency or burden, then it would be visible on your credit score. In this situation, credit bureaus note this default and mark it in their credit report.

Suppose, you have failed to complete a payment for a single month and fulfilled the payment in the second month; you would notice that this data has been forwarded to the credit bureaus by the respective lending establishments.

Your low CIBIL score is never permanent. You can follow some tips to improve your CIBIL score. Some of these measures are listed below to be followed to witness a gradual rise in your CIBIL score over a few months: