Maintaining a high CIBIL score is equally important, whether it is to be used for a home loan, personal loan or car loan. A good CIBIL score for a car loan can help in lowering the interest rate from leading banks/NBFCs, as it depicts your creditworthiness and responsible credit behaviour.
In the case of individual borrowers, a high credit score is essential to be approved for a car loan, as well as any other type of loan. The following sections discuss key aspects regarding how to achieve and maintain a good CIBIL score for a car loan.
Relevance of a Good CIBIL Score for a Car Loan
- Your CIBIL report, also called the Credit Information Report (CIR), is generated based on the repayment tenure and handling of loans and credit cards in the past.
- Your CIBIL score sums up how well you have handled credit in the past.
- A good CIBIL score should be as close to 900 and at least 760 and above.
- Simply put, the higher your score, the higher your chances of getting a car loan approved, whether for the purchase of a new car or a used car.
- The benefits of having a good credit score will not only improve your chances of being approved for a car loan but can also provide you with better access to special offers.
- These personalised offers can include 100% car financing, i.e. zero downpayment, lower than usual processing fees, special low interest rates, etc.
- While a good CIBIL score is desirable to avail a car loan easily, a comparatively low CIBIL score, such as 650 or below, does not automatically make you ineligible for a car loan.
- There is no minimum CIBIL score for car loan criteria as defined by lending institutions.
- A low score, however, can typically result in car loan offers that have a higher interest rate or a higher down payment requirement.
Also Know: What are the Factors that Affect your CIBIL score?
How to Check CIBIL Score to Apply for a Car Loan
Following is the step-by-step procedure to check CIBIL score before you apply for a car loan:
Step 1: Click here to check your CIBIL score
Step 2: Provide basic details such as name, mobile number, PAN and other relevant details
Step 3: Once you submit the application, you will see your credit score for free on the screen, followed by a detailed credit report
Step 4: You can also download the detailed credit report with important insights and tips (paid)