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CIBIL score for HDFC home loan

Planning to finance your house is hassle-free, affordable and quick with the help of HDFC Bank home loan facility. The Housing Development Finance Corporation (HDFC) is one of the major finance providers for housing in India. It’s not just your eligibility that decides whether you get your HDFC home loan but largely depends on your CIBIL score. CIBIL is Credit Information Bureau of India Ltd. which collects, analysis and maintains the credit information and history and makes them available to banks on request. This is basically to ensure that the borrower can repay the loan or not and this is calculated on the basis of CIBIL.

So why a CIBIL score is important for HDFC bank home loans

CIBIL score is very important for getting the loan approved. The bank basically checks your CIBIL score which helps them in determining your creditworthiness. This helps you in availing the loans or credits easily and faster.

When you apply for a HDFC Bank home loan, the lending bank basically takes the risk that you might not pay your loan. The CIBIL score helps you in gaining their confidence in your ability to pay the loan back. This also becomes the witness of your bad credit history. In case you want an unsecured HDFC personal loan, CIBIL is the only thing that the bank needs to decide on granting you the loan and access your credit eligibility.

HDFC Home loans for all

HDFC provides home loans to both salaried and self-employed on the same terms with the only difference of few different sets of documents needed. The creditworthiness and earning are the two main factors which determine the eligibility for a loan. Loans of up to Rs.2500,000 can be approved with easy and flexible EMI’s of 12 to 48 months. Generally, the loan is approved within 72 hours of application and does not require security, guarantee or collateral. HDFC also provides customized loans for working women and corporate employees.

A home loan helps you in buying your dream house and with HDFC, getting a home loan is very easy it a salaried personnel, self-employed or a businessman.

The eligibility criteria for getting home loans are simple. For a salaried employee, a permanent service in a government organization or in any reputed company is required. A professional qualification and practice are important for a self-employed professional whereas a businessman needs to be a regular income tax payer. The general criteria include healthy earning and sound credit history. Your earning reflects the ability to repay the loan and the credit history or CIBIL indicates your willingness to timely pay the loan. The bank requires few documents to determine the source and frequency, the consistency and continuity of your income and check if you are able to pay the loan back and CIBIL helps in ascertaining your readiness to pay.

What can get your home loan application rejected?

Getting a home loan can be rejected due to various reasons because the bank considers many factors before approving the loan.

Some of the common factors which can get your loan application rejected are listed below.

  • Credit Score: This is one of the biggest reasons for a home loan rejection, a poor or zero credit history. A poor credit history leads to a poor credit score which creates a bigger problem for you. Banks consider the profile with bad credit score to be of higher risks and this can easily get your loan rejected.
  • Low Income: Before approving the home loan application, the income is also considered for assessment of the ability to repay the loan. Suppose the personal loan EMI is greater than the monthly salary by a certain percentage, then the loan application will be rejected. In such cases low loan amounts are suggested to be applied for or adding a co-borrower can also increase the eligibility for a loan.
  • Delisted Company: If you are working with a company that has been delisted by HDFC, then your loan application is likely to get rejected. It is important that the company you are working with fulfills the listed criteria of the bank.
  • Incorrect Information: Before approving the home loan application, banks verify the details and the documents provided by you. In case of any wrong details filled or wrong document submitted by you, the bank rejects the application and this also affects your CIBIL score.
  • Unstable employment: Unstable employment is another factor which can cause the rejection of home loan application. The bank considers the stability in your job and your residence. If one changes the job very frequently, the bank will not consider you good enough for loan and the same applies for residence as well. If you keep changing your residence, then also, getting a home loan becomes difficult

Here are few tips for improving CIBIL score to get HDFC bank home loan

  • Manage your credit cards: Some people enjoy flaunting their credit cards and keep multiple credit cards with them. Most banks do not appreciate credit histories with multiple credit cards managed poorly. If you have multiple cards, more than 3, close them.
  • Use credit cards regularly: Using credit cards prove that you are able to handle short-term loans. It does not mean just using the card for payments but also pay the credit card bills. This ensures that you pay your credits on time.
  • Timely payments of outstanding: Defaulting on loan payments and EMI payments also causes bad CIBIL score. Pay your outstanding on time and pay off what you owe before owing more or at least 50-70% to keep your credit score good.
  • Do not overuse your credit card: It is not necessary to use the entire limit of your credit card. It indicates that your earning is not enough to manage your expenses and that you do not have control over your spending.

FAQs On CIBIL score for HDFC home loan

What are HDFC Personal Loan Interest Rates 2018?

FeeAmount to be PaidFeeAmount to be Paid
Rack interest rateSalaried - 15.50% TO 21.50%Charges for changing from floating to a fixed rate of interestNot applicable
Loan processing chargesUp to 2.50% of the loan amount subject to a minimum of Rs. 1,999/- & Maximum of Rs. 25000/- for Salaried Customers.Stamp duty & other statutory chargesAs per applicable laws of the state
Prepayment in Part or full (Refer FAQ section for detailed terms) Salaried - No pre-payment in part or fully permitted until repayment of 12 EMIs
Part Payment allowed up to 25% of Principal Outstanding. It is allowed only once in a financial year and twice during Loan tenure.
Credit assessment chargesNot applicable
Pre-payment charges (on principal outstanding) / Part Payment Charges [on Part Payment amount] Salaried - 13-24 Months - 4% of Principal Outstanding,
25-36 Months - 3% of Principal Outstanding
>36 Months - 2% of Principal Outstanding
Nonstandard repayment chargesNot applicable
Loan Closure LetterNILCheque swapping chargesRs 500/-
Duplicate Loan Closure LetterNILAmortization Schedule chargesRs 200/-
Solvency CertificateNot applicableLoan cancellation chargesNIL (However client would be charged interest for the interim period between the date of loan disbursement and loan cancellation and processing fees would be retained.)
Charges for late payment of EMI2% per month on EMI / Principal overdueCheque bounce chargesRs. 550/- per cheque bounce
Floating rateNot applicableLegal/incidental chargesAt actual

What is the Eligibility criteria for getting HDFC bank home loan?

The eligibility criteria for getting HDFC Bank home loan is primarily dependent on income and repayment capacity. Apart from these two most important factors, age, credit history; financial liabilities and financial positions also decide eligibility for bank home loan.

What if I have a low CIBIL score, will HDFC bank still give me a home loan?

CIBIL score works as the first impression for the loan applicant. CIBIL does not decide if the loan can be sanctioned. CIBIL helps the bank to ascertain that the bank undertakes the risk of lending money after having full information about the applicant.

Does skipping HDFC bank home loan payment affect my CIBIL score?

Yes, a single missed payment can reduce the CIBIL score. A skipped payment with any bank decreases the creditworthiness and financial institution may reject the loan application on the basis if low CIBIL score.

Had a loan settlement with HDFC bank, will it affect my CIBIL score?

Yes, this will affect your CIBIL score. Though the credit score will not mention amount overdue it will show ‘settled’ which means that you failed to pay the full amount of the loan and has only paid a part of it.

Can I get more than 3 HDFC Bank home loan if I have a good CIBIL Score?

Yes. There is no legal constraint on taking multiple home loans from a particular bank. If an individual has a good CIBIL Score and the bank feels that he or she has the capability to repay, they can issue multiple loans.