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CIBIL is known to bring complete transparency in the process of loan approval. Myths related to CIBIL should be known by every individual. Given below is the list of CIBIL Myths.
1. Effect of Closing Existing Credit Line on Credit Score:
It is often believed that there is no effect of closing the credit line on credit score. But this is not true. Whenever you close the existing credit line, there will be an adverse effect on your credit score. This happens because of a considerable increase in the ratio of utilization.
2. Zero Credit Improves Credit Scores:
This is a wrong belief among individuals. It is not true that the individuals who do not have a credit history can improve their credit score
3. CIBIL declines Loans:
This is another myth that is believed to be true by individuals. The fact is that loans are not rejected by CIBIL. CIBIL is known to provide the credit data of an individual to the bank or other lending institution.
4. CIBIL Maintains A List Of Defaulters:
Borrowers mostly have an opinion that CIBIL maintains a list of defaulters, this is completely a myth.
5. CIBIL Can Edit My Credit Info:
It is not possible for CIBIL to change an individual’s credit info directly. It can only mention that the changes have been made. This can be done only if the lender has provided that information to CIBIL and authorized it to edit it.
6. CIBIL Only Provides Credit Report:
This is not a fact. RBI has given an authority to all the four credit bureaus in India for the purpose of maintaining and providing the credit report. It is very well known that CIBIL is one among the other bureaus. Any of these bureaus can provide Credit Report.
7. Low CIBIL Score Means No Loan:
It does not mean that you will not be provided with a loan if your CIBIL Score is Low. There would be some difficulty in obtaining a loan; it is not true that you will not get a loan at all if your credit score is low.
8. Not Possible to Check Credit Score at Any time:
It is not possible to check the credit score all the time. You need to purchase your own CIBIL Report at any time you want to.
9. Healthy CIBIL Score Means I Will Getting a Loan at Lower Interest Rate Is Easy:
If you have a healthy CIBIL Score, it is not obvious that you will get a loan at a lower interest rate easily. There are other factors also that play an important role in obtaining a loan.
10. No Mention Of Your Name On Credit Record Is Good To Get A Loan:
If you do not have a credit record, it is not easy for the lenders to decide whether you should be granted a loan or not.
11. Easy Checking of CIBIL always:
This is completely false. The fact is that it is either you or only the registered lenders like NBFCs and banks can access your CIBIL if you have applied to them for a loan or a credit card.
12. ITR Filing Increases CIBIL Score:
CIBIL has no concern with the filing of ITR. There is no increase in your credit score if you have filed an ITR.
13. No Maintenance of Minimum Balance Affects CIBIL:
This is one such factor that has no impact on the CIBIL Score.
14. Checking My CIBIL Will Reduce Credit Score:
It will not affect the CIBIL Score if you keep checking it on a regular basis. It affects the CIBIL if various credit institutions check your CIBIL.
15. High Income Means High CIBIL Score:
There is no dependence of CIBIL Score on your income.
16. Defaulting Any Bill Damages CIBIL score:
There is no impact of the utility bills on CIBIL Score.
17. No effect of A Guarantor or Co-Borrower on CIBIL:
Being a Co-Borrower or a guarantor affects your CIBIL Score adversely. This adverse effect is due to the default made by the borrower.
18. Debit Card Usage Improves Credit Rating:
There is no impact of the usage of debit card on the credit rating.
19. Prepayment of a Credit Can Adversely Affect CIBIL Score:
If you have made a prepayment of a loan, your CIBIL Score does not get affected. It only shortens your credit history.
20. CIBIL Provides 100 % Accurate Information:
Sometimes the information like your personal details, contact details etc. can have some errors in the CIBIL Records. Therefore one cannot come to a conclusion that CIBIL provides 100 % accurate information.
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