Will your Cibil score fall if you check it regularly?

Cibil Score Myths: Building a healthy Cibil score is important for individuals seeking credit facilities from lenders. Whether you want a loan with favourable conditions or a credit card with a high credit limit, a lender checks your Cibil score before entertaining your application.

A high Cibil score boosts your chances of getting a credit facility from a lender.

It shows your creditworthiness and the health of your credit score.

But despite a Cibil score being such an important factor, there is not much awareness about it.

Not many people know how they can create a healthy score and what factors can affect their Cibil score severely.

More than that, there are several myths about Cibil score that create confusion among individuals.

Here, Raj Khosla, Founder & MD, MyMoneyMantra.com, discusses a lot of myths about the Cibil score and how we can stay away from them to create a healthy Cibil score.

Having Zero Credit is Good 

Having zero credit means you have never borrowed money from any financial institution.

Without a credit history, lenders have no way to get an idea about your creditworthiness.

This can make it difficult to get approved for loans or credit cards.

High Income Boosts Your Score

This statement is partially true, as although income is a factor lenders consider, your credit score is based on your credit history, not how much money you make.

However, a stable income can improve your chances of getting approved for credit.

A higher income also helps you in case you don’t have a credit score.  

Checking Your Credit Report Hurts Your Score 

In today’s world, knowledge is power, and when you have a true assessment of your credit report, only then can you make remarkable financial decisions.

It is highly recommended that you check your credit report once every 2–3 months to see if everything is in order.

This type of inquiry is categorised as a soft query, so your credit score does not take a hit.

Poor Score Means No Loan 

While a low score can limit your options, it doesn't mean you can't get a loan.

There are lenders who can still give you access to credit but the catch is that in such cases your interest rate will be higher than those who possess a good credit score.