A credit score is one of the most important numbers in your financial life. Whether you apply for a personal loan, home loan, credit card, or business loan, lenders check your credit score first to judge how reliable you are as a borrower.

If you understand how credit scores work and how to improve them, you can get faster approvals, higher loan amounts, and lower interest rates.

What Is a Credit Score?

A credit score is a three-digit number that reflects your creditworthiness — how likely you are to repay borrowed money on time. In India, major credit bureaus like CIBIL, Experian, Equifax, and CRIF High Mark generate this score based on your credit history.

Credit Score Range

• 300–549: Poor
• 550–649: Fair
• 650–699: Average
• 700–749: Good
• 750–900: Excellent

Most banks prefer a score of 700 or above for easy loan approval.

Why Credit Score Is So Important

Your credit score affects:

• Loan approval or rejection
• Interest rate offered
• Loan amount eligibility
• Processing speed
• Negotiation power with banks

A high score means lower risk for the lender, so they reward you with better terms.

What Factors Affect Your Credit Score?

1. Repayment History (Most Important)

Late EMIs, defaults, or settlements negatively impact your score.

2. Credit Utilization

Using more than 30–40% of your credit card limit lowers your score.

3. Credit Mix

A healthy mix of secured and unsecured loans improves credibility.

4. Credit Enquiries

Too many loan or card applications in a short time reduce your score.

5. Credit Age

Older accounts with good history positively affect your score.

• How Credit Score Impacts Loan Approval
• 750+ score: Best interest rates, quick approval
• 700–749 score: Approval likely with standard rates
• 650–699 score: Limited lenders, higher rates
• Below 650: High rejection risk

Even if your income is strong, a low credit score can block loan approval.

How to Improve Your Credit Score

Here are practical steps to boost your score:

• Pay all EMIs and credit card dues on time
• Keep credit card usage below 30%
• Avoid closing old credit accounts
• Do not apply for multiple loans together
• Regularly check credit reports for errors
• Avoid loan settlements unless unavoidable

Improving credit score takes discipline but pays off for years.

Credit Score vs FOIR vs LTV

Banks consider all three together before approving a loan.

How Direct Credit Helps You

At Direct Credit, we don’t just apply for loans — we analyze your credit score, FOIR, and LTV to match you with lenders that suit your profile. We also guide you on score improvement strategies so you qualify for better rates and higher loan amounts.

Contact Us

Worried about a low credit score or unsure how it’s affecting your loan eligibility? The experts at Direct Credit can evaluate your credit profile and connect you with the right lenders — even in challenging cases. Call us at 9010031003 for personalized guidance, faster approvals, and transparent loan solutions.