I am 35 years married with a son and residing in Udupi in a rented place. I want to reside in my own home and am looking for a home loan. A friend has told me that CIBIL score inquiry from multiple banks will reduce my credit score? Is this true?
All enquiries for CIBIL Score through any Bank will finally go to, and will be answered by the Credit Information Bureau (India) Limited or CIBIL, which is a Credit Information Company (CIC). Credit Information Report (CIR) and CIBIL TransUnion Score are very important in the loan approval process, to identify consumers who are likely to be able to pay back their loans. Inquiry about CIBIL score does not affect your score while inquiry about loans from multiple banks can affect your CIBIL score. These are some of the factors which influence your credit score: Pay all your loan EMIs and credit card dues on time to maintain a good credit score. If you have been making timely payments for your loans/ credit cards for a longer period of time, it will increase your credit score. A better credit mix i.e. your credit (liabilities) spread across credit cards, auto loan, personal loan, home loan also helps in improving your credit score. Credit utilization ratio is the ratio of total credit (liabilities) that you owe to your total credit limit. A very high credit utilization ratio is considered risky and has a negative impact on credit score. Whenever you apply for a loan or a credit card, the lender will run an inquiry on your CIBIL report. More number of inquiries indicate that you are credit hungry which is not a good sign for your credit health. Hence, higher number of credit inquiries have a negative bearing on your credit score.
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