CIBIL Score Tips: Once the loan defaults, for how many years does the CIBIL score remain bad? know here...

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If you do not repay on time i.e. your loan defaults, your CIBIL score gets damaged. Like a child appears in an examination and does not get good marks if he does not give the paper properly. Later, due to the same low marks, the child does not get admission to a good college.


The same situation happens when a loan is taken and it defaults. If you do not repay the loan, you get the notoriety of default due to which your CIBIL score (Credit Score) gets spoiled. Next time you go to any bank to take a loan, you will not get the loan and even if you get it, it will be at a high rate of interest with huge hassles. Now the question is whether the CIBIL score gets spoiled from birth to birth. Is there no scope for any patching or improvement in it? If this were the case then people would probably never default on loans. There must be some scope available so that the way forward can be opened and some loan can be obtained.

Understand this example
Let us understand the basics of credit score with a simple example. Suppose you took a loan from a bank to build a house. Initially, you kept paying the loan installments (EMI) when suddenly you lost your job or your business collapsed. In this situation, you have no option but to stop the installment (LOAN EMI). As soon as the EMI stops, the bank puts you in the default category. Later the financial situation improved and you paid the remaining installment and the interest charged on it to the bank. This would make you think that the loss in CIBIL score will be compensated.

You kept your hopes right, but experts say that despite doing everything, the CIBIL score remains bad for at least 2 years. Pay the pending installment (LOAN EMI) or even pay its interest, CIBIL score does not improve for two years and its loss is seen in many financial needs.

CIBIL score error cannot be hidden
The wind of credit score is such that its waves reach every corner. That is, the negative ranking of your CIBIL score reaches every bank and finance agency. Whenever you next go to any bank for a loan or to finance companies for a car loan, they will know your negative score immediately. In such a situation you will not get the loan. Even if a loan is obtained after a long struggle, its interest rate will be recovered at higher rates. Then you come to know very well about the importance of CIBIL score.
How does the CIBIL score improve?
The CIBIL score gets positive by looking at your transactions and payments of credit cards or small bills. Do not delay in payment of bills, pay the entire bill on time. Like, pay the entire credit card bill, not the minimum due amount. This improves the CIBIL score. Many times people do not take NOC from the bank after taking the loan and repaying it on time, due to which the CIBIL score goes negative.

NOC should be taken immediately from the bank, only after which your data on CIBIL is updated. The same thing is true with credit cards. If you close a credit card, complete all the paperwork with the bank. Take the certificate of closure of the credit card from the bank. All these things improve your CIBIL score.

Does repeated checking spoil the CIBIL score?
Many people have a question if we check the CIBIL Score again and again, will it go down? Our answer to this is yes and no. Let us tell you why this is so.

CIBIL Score is a report of the history of the customer, which tells the bank when the loan has been taken and when the inquiry about the loan has been made. If you are checking your CIBIL score yourself, there will be no impact on your CIBIL. Apart from this, if you apply for a loan, the loan-giving company will check your CIBIL score. When the company checks, there are chances that your CIBIL score will go down.


What should be the CIBIL score to take a loan?
For this reason, do not inquire about more loans. You can check your CIBIL score any number of times, there is no problem. CIBIL score ranges between 300 to 900.
Very good: 800-850
Very good: 799-740
Good: 739-670
OK: 699-580
Very bad: 579-300

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