When it comes to looking after your financial habits, taking care of credit scores is crucial. A good credit score, especially when asking for a personal loan, boosts your chances of acceptance and securing a favourable interest rate. Individuals with higher credit ratings might also request reduced rates, flexible loan tenures, etc.
Let’s dive deeper into this article to understand what a good Experian credit score is and look at its benefits.
What is a good Experian credit score?
Credit scores are a three-digit numeric figure of an individual’s creditworthiness based on their credit history and past credit ratings. Experian, a credit bureau authorized by the Reserve Bank of India (RBI), assigns credit scores to individuals in a similar context.
They range in number from 300 to 850. An in-depth analysis of the customer’s credit usage, length of loan history, past transactional patterns, re-payment history, credit mix, etc
A decent Experian credit score of 650 or higher indicates minimal risk for lenders, which means consumers have a better chance of acquiring a personal loan with favourable terms.
What are the advantages of having a good Experian credit score in personal loans?
Power of negotiation interest rates in your hands
If you have an excellent Experian credit score, lenders use credit scores and are more willing to negotiate loan terms, including interest rates. As a result, you’ll be able to select one that appropriately matches your needs, which vary from borrower to borrower. With a solid credit score, you’ll be in a better position to bargain with your lender on interest rates.
Provides easy loan approval
Anyone can need money to meet their financial obligations with easy access to personal loans. Secured and unsecured loans are the two most common forms of loans offered by lenders. Any lender, especially in unsecured loans, does not want to take on credit risk when making a loan offer. As a result, persons with good credit can get approved quickly.
It makes your financial goals achievable.
Often, achieving bigger goals requires a large amount of funding. Personal loans help a lot to fuel your dreams. You can easily give your aims a high if you have an excellent Experian credit score.
No limit on borrowing capacity
Lenders usually determine a person’s ultimate loan and credit card limit based on their monthly income. Aside from that, a person’s credit score can affect their borrowing capacity. Lenders are more optimistic that if a person has a strong credit score, they can repay the loan amount on the agreed time. As a result of their excellent payback history, those with good credit scores might anticipate receiving a more considerable loan amount.
A credit score plays a vital role in our loan approval process and other lending decisions. Hence, maintaining a good credit score to secure the most attractive loan should also be a prime priority
Before making a final selection, you can evaluate multiple lenders for the best rates or conditions. You can seek guidance from Buddy Loan, where you can get collateral-free personal loans of up to 5 lakhs with an affordable interest rate of 11 % per annum.