Impact of Days Past Due (DPD) on Your Loan Eligibility

The credit bureau of the country, TransUnion CIBIL, computes the CIBIL report which encompasses your credit scores. This credit score determines whether you are eligible to apply for a loan or not. The higher the credit score you have, the better your chances of getting quicker approvals.

There are certain aspects that the lender or the bank examines in your credit report whenever you apply for a loan. Days Past Due is one of the important aspects. Many banks face the problem of long-overdue dues, and many debts are written-off due to non-payment. To avoid this, they will be cautious while analysing the new applicants.

Knowing CIBIL reports online can help you to a great extent. Banks give great regard to the report’s details, and when they see your score in the higher range, you are sure to get the loan. Check CIBIL report online and create a flawless impression when you plan to borrow loans from lenders or banks. 

What is DPD in Your Credit Report?

DPD literally stands for Days Past Due. You can see this when you check CIBIL report online. Your account information gives details of the days past due. It helps to give out information about how long you have crossed your due date of bill payments.

This information is kept up to 36 months of your payment history. It is denoted as DPD 060 030 000 000 if you have defaulted for a period of 2 months after payments have started. XXX would indicate no information, and 000 means no default.

Can I Clear DPD in My CIBIL Report?

You cannot change the values that have already appeared on your DPD. If you have made defaults in payment in any month, the only way out is to clear them as early as possible. 

If you are disciplined in your payments for the next 36 months, your DPD reports will be clear of the values.  When you maintain a steady repayment history, lenders don’t fail to recognize your application for loans. CIBIL report’s online check will help you track your credit record.

Why is CIBIL Report Essential?

Your credit report, as you have already seen, is a detailed summary of your creditworthiness. It reflects your financial health. If you want to make the loan process hassle-free, it is essential to have a good credit score on your credit report. 

The credit report will become the basis for your credit scores. These are scores from anywhere between 300-900, where 300 is the least and would not be considered for a loan. Also, based on your credit report, only your borrowings would depend. It speaks about your ability to borrow and repay based on your past activities. 

A credit report is also important to monitor and identify any credit frauds. Monitoring your CIBIL report online is essential so that you are aware of what the lender is reading on your report.

What does a Credit Score Mean?

Most often, your credit score is mentioned as a CIBIL score. The TransUnion CIBIL is the agency that reports your score. In India, it is the oldest credit rating agency and has a high reputation and functions under the license granted by the Reserve Bank of India. The TransUnion CIBIL also provides you with CIBIL reports online for easy reference.

The credit score is an important indicator used by lenders to assess the creditworthiness of potential borrowers. These scores are a three-digit number representing how credits such as personal loans, mortgages and credit cards have been administered in the past. 

The credit score shows the lender regardless of whether it is a trusted borrower. When requesting any credit card type, the lender or NBFC examines your credit score and the credit history maintained in your credit report. Your credit score is calculated from 300 to 900. The greater your credit score, the better, since it is more likely to approve it for new credits.

Key Points on CIBIL that You Need to Know

• CIBIL does not maintain a list of defaulters, but it only has the credit history details of customers who have requested it.
• CIBIL helps lenders and customers because it helps them keep an eye on their financial health. 
• A low credit score for a loan does not mean you cannot get a loan at all. You still have other options like collaterals.
• CIBIL score is not the only factor on which your credit is judged. Lenders also look into your income and several other factors.

Is the Credit Score the Same as the CIBIL Report?

No, the Credit Score is not the same as the Credit Report. The Credit Report contains details about your home loan, personal loan, vehicle loans, bill payments, inquiries, and credit score.

It is actually your detailed credit history listed out. It is also known otherwise as a Credit information report. When you wish to borrow money from a recognized organization, your credit report will be required to be presented. The lenders decide on your loans after a thorough analysis of the same.  To maintain a high credit score, you need to Check CIBIL Report Online Regularly.

What are the Main Components of a Credit Report?

The important components of a credit report are as follows:

CIBIL Score

Your CIBIL score, which is the numerical 3-digit value, is a part of your credit report. A score of 750-900 indicates strong financial well-being and places you in a better position when getting loans.

Personal Details

Information like name, date of birth, PAN, Aadhaar are also present in the report. You have to check if all the details are presented correctly.

Contact Details

Address, mobile number, and email address are mention in the report. 

Employment Details

Employment history which mentions where you are working, your salary particulars, etc.

Account Information

Information about your loans and credit cards is present in the credit report. It also includes a 3 year month by month report of your EMI payments. 

Inquiry Detail

The number of inquiries from lenders made previously is reflected in the report.

How can I Get my CIBIL Report Online?

Check CIBIL reports online regularly and correct any discrepancies on them before they become a red flag. You have subscription plans to get your CIBIL score reports like once a month, 6 months once, and a 1-year plan on payment of a fee. The procedure to obtain the report is as follows.

• You can create an account by filling in all basic personal and contact information.
• You will be sent an OTP for authentication.
• Make the payment after the previous step, and you are good to go.
• You can check your report here and download it as Pdf too.

How to Get a Personal Loan Without CIBIL Verification?

Applying for a personal loan even without a CIBIL verification has now become easy. Follow these simple tips to help you in this process.

1. Income proof – You have to provide proof of your income to your lender to be satisfied with your repayment capability.
2. Less loan amount – Always request a lower amount as a loan when you don’t have a CIBIL score. A higher amount of loan without a backup score will not work in your favour.
3. Pledging collaterals – You can get loans based on your assets’ collateral security like shares, gold, or fixed deposits.

How to Choose a Bank for Getting a Loan?

The interest rate offered by the bank is an important factor. Different banks offer different rates of interest. Based on your income and capability, you have to choose your interests. It is always wise to choose a lower interest rate on loans. The processing fee of the bank also impacts your decision on the choice of the bank. Choose a bank with low processing fees. Changes in rates of interest are made as and when the RBI makes any changes. So when you have chosen floating rates, you have to check if the bank revises the rates per RBI. Make sure the documentation process of your bank is not a big burden. Choose a bank with a low turnaround time, as your loan will be processed quickly when all relevant details are furnished.

Can CIBIL Score Impact your Loan Eligibility?

The lender needs some basis to analyze the credit health of the customer. This is possible with recognized agencies like CIBIL. CIBIL report online displays CIBIL score for a loan which is a definite indicator of the customer’s creditworthiness. The score is given in ranges starting from 300 till 900. Lenders get an impression about the ability to repay from this score only. 

Though it is essential, CIBIL is not the only basis on which the lending decisions are made. This becomes very true when the customer has no credit history in the past due to zero loans. He will not be given any CIBIL score, which does not mean he is not eligible to get a loan. So you can say that CIBIL score is a factor but not the only factor determining loan eligibility.

Is It Possible to Improve your Credit Score?

It is possible to improve your credit score by up to 100 points within a month. Just follow the simple steps:

• Get a copy of your credit report, and you can also download it for free.
• Look out for the negative accounts in the report generated that include late payments.
• Raise a dispute on the incorrect information that you find on the report. You can do this over the phone, or in-person, or through emails.
• Pay all your credit card balances and settle everything. When there are no dues, you are sure to improve your score soon.
• Check CIBIL report online for any abnormalities that may bring down your score.
• Adding your name as an authorized user in some other person’s account, provided he has a high financial reputation, can also help in score improvements.

The above are clear indicators of what a credit score is, who furnishes it, and also the various components. As a borrower, you have to understand the importance of a credit report and its impact on your loan eligibility. Be prompt in your payments and try not to get tangled in too many loans simultaneously. Instant loans without CIBIL may be possible, but still, it is beneficial if you have a good credit score on the reports. 

Discuss any problem with your lenders and make an amicable settlement possible if you require an extension of time. Always work towards improving your CIBIL score because it is a critical factor that lenders are dependent on. If you are in the lower brackets, make earnest efforts and try to come into the 750-900 range so that your processing becomes very smooth.

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