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Loan Approval Tricks India: When you take a loan from any bank, the first thing that is seen is your CIBIL Score. With this the bank decides whether you are a trustworthy customer or not. Will you be able to repay the loan on time? The better your CIBIL score, the easier you will get the loan and at a lower interest rate. CIBIL score ranges between 300 to 900. Scores above 750 are considered the best. A score of 550 to 750 is fine. But banks can be a little strict.

Scores below 550 are considered poor. It becomes almost impossible to get a loan. The closer the score is to 900, the more benefit you will get. Missing EMI hurts the CIBIL score the most. CIBIL score may drop if one or two EMIs are late. By consistently paying EMIs on time, the score improves rapidly. Banks consider you a trustworthy customer and approve the loan easily.

Apply in 1 to 2 banks also

Many people apply for loans in different banks in search of low interest. Every bank checks your CIBIL score. This is called hard inquiry. Score falls due to more hard enquiry. One should apply to only one or two banks at a time.

Credit card is also a kind of debt

Credit card is also a type of debt. Increasing the limit poses a risk of increasing expenses. Higher limit and higher EMI show your financial condition is weak. The bank feels that you are taking more loan than necessary. This may cause the CIBIL score to drop. If your card limit is Rs 1 lakh then it is not right to spend Rs 1 lakh every month. The rule is to use only 30% of the credit limit. This keeps your credit utilization ratio good. On the basis of this ratio the CIBIL score becomes stronger. Seeing good score, banks will also give many loan offers. But taking more loan shows your financial condition is weak. The bank feels that you are constantly dependent on loans. This may cause the CIBIL score to drop. Do not take loan without need.

Loan will be available immediately after getting Cibil Score.

If you ever go to take a loan, first of all your CIBIL score is checked. If CIBIL is good then the loan will be available immediately. If CIBIL is bad then there is difficulty in getting loan. Many times a loan is available after giving some mortgage, but its interest rate may be high. Cibil is calculated on the basis of these 4 points. Your payment history plays the biggest role in the calculation of your credit score. In this we see how many payments you made on time. If a payment is made late, how many times is it delayed? Also see how many times payment or EMI has been missed. Its share in the calculation of CIBIL score is 30 percent.

How much is the total outstanding?

It is also seen what your total outstanding is. How much credit or loan is there in your name and how much of it you have utilized. Its share in the calculation of CIBIL score is 25 percent. While calculating CIBIL score, it is seen what type of loan you have. In this it is checked how many unsecured loans are there. How many secured loans are there? The more secured loans you have, the better your CIBIL score. Let us also see what is the tenure of those loans. Its share in the calculation is 25 percent.

20 percent dependence on other loan activities

The remaining 20 percent in this calculation checks other activities to your loan. In this it is seen how many loans have been taken recently i.e. how many loan accounts have been opened and closed in your name. Let us also see what your credit utilization ratio is. It should not be more than 30-40 percent.