Relevance of Good CIBIL Score for Car Loan
Credit score is a 3-digit numeric which is part of an individual’s CIBIL report. Your CIBIL report, also called the Credit Information Report (CIR), is generated based on the repayment tenue and handling of loans and credit cards in the past. Your CIBIL score sums up how well you have previously handled credit by assigning a number between 300 and 900. A high CIBIL score is closer to 900 such as 750 or higher. Also simply put, higher your score, higher are your chances of getting a car loan approved, whether for purchase of a new car or a used car.
But a good credit score will not only improve your chances of being approved for a car loan, but can also provide you better access to special offers. Such offers can include 100% car financing i.e. zero down payment, lower than usual processing fees, special low interest rates, etc.
Also Know: What are the Factors that Affect your CIBIL score?
While a good CIBIL score is definitely 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. However, a low score can typically results in car loan offers that have a higher interest rate or a higher down payment requirement.