ATM :: Four things your credit report will not tell you

CreditVidya | Published: Oct 08 2014, 12:07 IST | Financial Express
In order to assess your loan eligibility or your eligibility for a credit card, it has become mandatory for lenders to check your Cibil report. Cibil, the nations’s premier credit bureau, maintains a record of your past loans and use of credit. As a consumer, you must check out your Cibil report at least once annually, to see whether there are any discrepancies in it.

With increased awareness about credit history, people are seeking out their credit reports these days, but more often than not they expect it to be progress report of sorts, and are thus disappointed and unable to figure out its purpose when they have it in hand. Just so that you do not face any such dilemma, here is a lowdown about the stuff that you will not find in your credit report.

Credit score
Although the credit report and credit score are terms that are used interchangeably, you should know that they are not the same thing and you will not find your credit score if you only make a request for your credit report. A credit report is detailed report all your financial transactions of the past and present, while a credit score is a three digit numeric summary of your credit history that is derived on its basis. In order to check your credit score you must purchase it separately. For instance in Cibil you can purchase your Cibil report for Rs 154 but in order to purchase your Cibil score along with the report you need to pay Rs 470.

The areas that need improvement
Your credit report has all the details of your financial transactions, but it is not a report card, so it does not tell you where you need to improve. Once you have your report in hand you must do the math yourself and add up all your credit card balances and credit limits and find out if your credit utlisation rate is high.
Ideally your credit utilization rate should not exceed 30%. You also need to figure out if you need to make repayments at a better pace in order to improve your credit score.

The interest rates you are likely to be offered
Don’t expect your credit report to tell you whether you are eligible for a particular type of loan you have in mind. You will also not get to know the interest rates for which you qualify. However its advisable to take a look at your credit report at regular intervals to ensure that discrepancies in your report do not derail your plans.

The unexplained inquiries on your report
You may be surprised to see a number of inquiries on your credit report that have been made without your knowledge. These may be individuals, companies who may wish to review your report to figure out whether they can extend a job offer to you or a partnership, if you are a businessman. However, you need not worry about such inquiries as they are soft inquiries and do not impact your credit standing.

Now that you know what your Cibil report will not give you, its time for you to figure out how it impacts your chances of getting the loan you may have been planning. If you are still finding difficulty figuring it out, it’s a good idea to discuss with your financial planner.

NOTE: The Express Group takes no responsibility for the veracity of content provided by

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