LoansFinancial Glossary
Credit Score (CIBIL Score)
Definition
A three-digit number between 300 and 900 assigned by credit bureaus (TransUnion CIBIL, Equifax, Experian, CRIF Highmark) that represents your creditworthiness. It is computed from your loan repayment history, credit utilization, length of credit history, credit mix, and recent enquiries.
Why It Matters
Banks use your credit score as the first filter for loan approvals. A score below 650 often means outright rejection. Scores above 750 can fetch interest rates 0.25-1% lower, which on a Rs 50 lakh home loan over 20 years translates to savings of Rs 3-8 lakh in interest.