650 CIBIL Score - Is it good or bad?
A 650 CIBIL Score is categorised as fair, slightly below the threshold for good creditworthiness. It reflects moderate financial risk, suggesting irregular payments or higher credit utilisation. While borrowers with this score can qualify for loans or credit cards, lenders may impose higher interest rates or stricter terms. A 650 score limits access to premium financial products and signals the need for better financial discipline. By improving repayment habits, reducing credit utilisation, and monitoring credit reports, borrowers can work towards achieving a higher score. A better score ensures access to loans and credit cards with competitive terms.
How to improve your 650 CIBIL Score?
Improving a 650 CIBIL Score requires consistent financial discipline. Start by ensuring all loan EMIs and credit card bills are paid on time, as timely payments improve credit scores. Keep your credit utilisation ratio under 30% of your credit limit to demonstrate responsible credit management. Avoid frequent loan or credit card applications, as multiple inquiries may negatively impact your score. Regularly review your CIBIL report to identify and rectify any discrepancies. Maintain a healthy mix of secured and unsecured credit. With disciplined efforts and patience, you can steadily improve your credit score and access better financial opportunities.
How does a 650 CIBIL Score impact interest rates?
A 650 CIBIL Score can result in higher interest rates on loans or credit products. Lenders consider borrowers with this score as moderately risky, leading to less favourable terms. While borrowers with excellent scores may secure loans at interest rates as low as 10%, those with a 650 score might face rates exceeding 13%. Higher rates increase the cost of borrowing, making repayments more expensive. Improving your credit score through timely payments and reduced credit utilisation can help secure loans with lower interest rates, resulting in significant financial savings over time.
