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Credit Score

What Does a 777 Credit Score Mean?

What Does a 777 Credit Score Mean?

Have you ever applied for a loan and wondered why you got a higher interest rate? It becomes doubly confusing when someone you know receives a lower interest rate from the same financial institution. It makes you wonder, doesn’t it, if a deeper conspiracy is at play or if your luck is just that bad. 

Fortunately, none of this. It simply means that you didn’t possess a good CIBIL score or credit score at the time of your application. It’s not your fault, either. Surprisingly, many people are not aware of this critical metric. The good news is once you understand it, you hold the key to improving your credit score and all the benefits that come with it.

Are you wondering where to start? Start right here with this article, which covers the CIBIL score basics and also provides tips on achieving and maintaining a good CIBIL score.

What is the CIBIL Score?

Simply put, your CIBIL score is a quantitative measure of your creditworthiness. It is a three-digit summary (300-900) that captures your credit history and gives prospective lenders an indication of your credit risk, i.e., whether you are more or less likely to default on your loans. The higher your CIBIL score, the higher your creditworthiness. For example, for a lender, someone with a 300 CIBIL score is a credit risk compared to someone with a 777 CIBIL score.

CIBIL stands for Credit Information Bureau India Limited. It is one of four credit information companies with an operating license from the Reserve Bank of India. The other three are Equifax, Experian and Highmark. However, CIBIL is the most well-known and widely used among these four.

What Factors Affect the CIBIL Score?

So, what factors decide whether you get a high or a low CIBIL score? Let’s take a look:

1. Payment history

The most crucial factor that impacts your CIBIL score is whether you pay your bills (loan EMIs and credit card bills) on time. The weightage of your payment history in your CIBIL score is around 35%. If you delay your bill payments by a month, your credit score can drop by 100 points.

2. Credit usage

Credit usage contributes 30% to the CIBIL score. It refers to the percentage of the maximum credit limit utilised. For example, consider that you have a credit card with a limit of INR 1 Lakh and use Rs. 60000, which gives you a credit usage of 60%. Credit usage of more than 30% negatively impacts the CIBIL score. 

3. Length of credit history

This factor contributes around 15% to your credit score. Also known as credit age, the length of credit history determines how long you have held credit accounts (loans or credit cards). Further, the average age is used to calculate the CIBIL score if you have multiple credit accounts. Hence, opening a new credit account can lower the credit age and the CIBIL score.

4. Credit mix

Credit mix contributes around 10% to the final CIBIL score. It determines the variability in your credit account, meaning what different types of credit accounts you hold, such as credit cards, mortgage loans, unsecured loans, etc. A diverse credit portfolio positively impacts your CIBIL score as it displays your ability to manage various kinds of debt over time.

5. New credit

Opening a new credit account contributes around 10% to the CIBIL score. However, it is a double-edged sword, as it also lowers the score in the short term. Maintaining low credit usage on a new account can boost your CIBIL score over time.

What is the Maximum CIBIL Score in India?

The maximum CIBIL score you can achieve in India is 900. A score closer to 900 indicates an excellent credit profile and signals very low credit risk to lenders. However, reaching 900 is rare, as it requires a long credit history, consistent on-time repayments, low credit utilisation, and a well-balanced credit mix over several years. 

Even scores in the range of 750-800 are considered strong and sufficient for accessing most credit products at favourable terms.

Why is a Good CIBIL Score Important?

The benefits of a high CIBIL score include:

1. Loan approval: A high CIBIL score increases your chances of getting loan approval and even pre-approval.

2. Lower Interest Rates: A good CIBIL score also ensures that you get a favourable interest rate, significantly reducing your loan repayment burden.

3. High credit limits: A high CIBIL score also makes you eligible for obtaining a higher loan amount. This is because a high credit score signals to lenders that you’re a safe bet, and hence, they can trust you with a higher loan amount.

Benefits of a 777 CIBIL Score for Personal Loans, Credit Cards & More

A 777 CIBIL score reflects strong credit discipline and gives lenders confidence in your repayment ability. This works in your favour across multiple financial products. 

1. Higher chances of loan approval: Lenders are more likely to approve your personal loan, home loan, or car loan applications when your credit score is in the very good range.

2. Lower interest rates: A strong CIBIL score can help you access loans at more competitive interest rates, reducing your overall repayment burden.

3. Higher credit limits: Banks may offer higher loan amounts and increased credit card limits, as your score signals lower credit risk.

4. Access to premium credit cards: You may qualify for premium or rewards-based credit cards that come with better benefits and offers.

6. Faster processing and flexible terms: A 777 score can lead to quicker approvals, fewer documentation requirements, and more flexible loan terms.

Is a 777 Credit Score Good?

Here is a table of various credit scores and what it says about your creditworthiness to lenders.

Credit Score RangeCreditworthiness
300-625Poor
625-750Fair
750-800Very good
800-900Excellent

According to this table, 777 CIBIL score is considered a very good score, signalling a solid credit history and trustworthiness to lenders. However, this score falls short of an excellent credit score. Let’s discuss how you can go from a very good CIBIL score to an excellent one next.

How to Improve or Maintain a 777 Credit Score

Follow these simple steps to increase your 777 CIBIL score effectively:

1. Timely payment of bills

Your credit score increases if you pay your credit bills and loan EMIs on time. Additionally, even a short delay in bill payment can negatively affect your score.

2. Limiting credit utilization

Keeping credit usage below 30% of the maximum credit limit can boost your CIBIL score.

3. Building a credit mix

Having a diverse debt portfolio reflects favourably on the credit score. However, note that if you don’t have diverse debt, you should not consider acquiring it just for a good CIBIL score. 

4. Limiting new credit applications

Do not apply for multiple credit accounts within a short span, as it can lower your CIBIL score.

Wrapping Up

We hope that this article answers all your pertinent CIBIL score questions such as what it is, how it is calculated, and credit score of 777 what does it mean. A high CIBIL score signals your creditworthiness to lenders and makes the process of obtaining and repaying loans easier. That being said, the CIBIL score is not written in stone and can be improved by following the simple steps given in the article. 

It’s essential to know your CIBIL score first to manage it properly. Reliable CIBIL score calculators are hard to come by. Tata Capital, a leading financial institution with an illustrious history of serving millions of customers, provides one such credit score calculator. What are you waiting for? Visit the Tata Capital website and calculate your CIBIL score now!

FAQs

Is 777 a good CIBIL score or is it possible to get 900?

A 777 CIBIL score is considered very good and reflects strong credit behaviour. While 900 is the highest possible score, it is rare and not necessary to access most loan benefits.

What is the highest CIBIL score you can achieve in India?

The highest CIBIL score you can achieve in India is 900. This score represents excellent credit discipline, low risk, and a long history of responsible borrowing and repayment.

What are the benefits of having a 777 CIBIL score?

With a 777 CIBIL score, you are likely to receive quicker loan approvals, better interest rates, higher credit limits, and access to pre-approved loan and credit card offers.

How is the CIBIL score calculated and updated?

Your CIBIL score is calculated using factors such as payment history, credit utilisation, credit age, credit mix, and new credit. It is updated regularly based on lender-reported data.

Is a 777 CIBIL score enough for best loan offers and lowest rates?

A 777 score is strong enough to qualify for competitive loan offers. However, lenders may reserve their lowest rates for borrowers with scores closer to 800 or above.

Can my CIBIL score be different from other credit scores (Equifax, Experian)?

Yes, your CIBIL score can differ from scores issued by Equifax or Experian. Each bureau uses similar factors but may calculate scores differently based on available data.

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