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CIBIL score for ICICI bank home loan

Financing your house is easy, quick and affordable with ICICI Bank’s home loan facility. While there are various factors which help the bank decide on the worthiness of a loan applicant, the most important is the CIBIL Score. Read on to understand the importance of this factor for home loan applications.

Importance of CIBIL Score for getting ICICI Bank Home Loan

A good CIBIL Score is the most important pre-requisite while applying for a home loan. It is very important for ICICI Bank to ensure that the person to whom the loan is being given can repay it back in the future. The CIBIL Score tells the lender the credit worthiness of the loan applicant and helps them gauge the likelihood of default basis the past repayment trend.

ICICI Bank Home Loan Information

ICICI Bank offers easy and quick home loans. Some of the key highlights of home loans offered by ICICI Bank are:

  • Minimal documentation
  • Swift processing through tablet and smart phone applications
  • Enhanced eligibility limits
  • Attractive rates of interest
  • Tailored home loan options

ICICI Bank specializes in offering customized home loans as per the needs of their customers. The various loan options are:

  • Mortgage Loan Options
  • ICICI Bank Extraa Home Loans (Enhanced loan limit and extended repayment period)
  • ICICI Bank Pragati Home Loans (for affordable housing segment)
  • Pradhan Mantri Awas Yojna
  • Balance Transfer (transfer of home loan from other banks to ICICI Bank)
  • Top-Up Loan (loan for personal requirements for home loan customers)
  • ICICI Bank Saral Rural Housing Loan (for women borrowers and members of weaker sections)
  • Home Improvement Loan (refurbishment of self-owned dwellings)
  • Loan against property
  • Lease Rental Discounting (funds on the basis of future projected rentals from self-owned commercial property
  • Office Premise Loan for commercial properties
  • Land or residential plot Loan

Additionally, ICICI Bank also offers special home loans to Non-Resident Indians (NRIs) and Persons of Indian Origin (PIO)

Probable reasons for ICICI Bank Home Loan rejection

A home loan application might be rejected by ICICI Bank due to one or more of the following reasons:

  • Low Credit Score : A low CIBIL Score indicates that the applicant has missed or delayed on his or her credit obligations in the past. Hence, the bank has lesser confidence in the applicant’s ability to repay the loan amount. Typically, a score of 700+ is considered good for ICICI Bank home loan purposes.
  • Lack of stability in employment : If the applicant has jumped jobs frequently or has long periods of gap in employment, it is a matter of concern for the bank. It is unsure if there would be a steady source of income in the future which would contribute towards the loan repayment.
  • Inadequate income : Insufficient income or over borrowing is another reason why ICICI Bank might reject a home loan application. It also holds true when the applicant’s current financial and credit obligations are very high which may in turn mean lesser funds for home loan repayment.
  • Age of applicant : In some cases, the age of applicant leads to rejection of the home loan application. For instance, if the applicant is a salaried individual and nearing the retirement age, then ICICI Bank might feel that he or she would not be able to pay back the loan in the future.
  • Geographic risk : ICICI Bank maintains an exhaustive database of the defaulter’s demographics. Basis those records, some locations are classified as high-risk areas as the percentage of default from those areas is extremely high. If the applicant belongs to such location, then the loan request may not be entertained.
  • Insufficient tax paying history : All banks prefer applicants who have a steady and active tax filing history. It is easier to ascertain the credit worthiness of such people. If such information is not available, ICICI Bank may hesitate to offer home loan to such applicants.
  • Guarantor on a default loan : If the applicant is a guarantor for a loan that is currently in default stage, then ICICI Bank will reject the home loan application.

Tips for improving CIBIL Score to get ICICI Bank Home Loan

In order to improve the CIBIL Score, one needs to understand the factors that impact this metric. Broadly speaking there are three elements that are evaluated to arrive at this score.

  • Past relationship with credit : This element has the highest weightage of approximately 30% towards the score’s calculation. Laxity or defaults in paying back dues in the past will adversely impact one’s CIBIL Score today. Such habits not only end up in piling up the amount of late fees but also drastically drag down the CIBIL Score.
  • Type of credit and duration : The type of credit taken by the borrower (secured or unsecured) along with the duration of the credit history lends another 25% weightage to the calculation.
  • Exposure : Credit exposure or the total amount of credit lent to the borrower contributes 25%. Lesser is the amount of money owed, higher is the CIBIL Score.
  • Others : The balance 20% is derived from factors such as credit utilization, the behavior towards credit in the recent times, demographics including age, place of stay etc.

Basis these factors, here are some tips to improve one’s CIBIL Score:

  • Timely repayment : A disciplined repayment behavior goes a long way in improving the CIBIL Score. One should ensure that there are no delays or misses in the payment of the monthly dues. This applies to loan EMIs as well as credit card bills. One should try to ensure that they clear off their monthly dues in full (and not merely the minimum amount) and within the timelines. Also, if one is making the payment through cheque, it is better to do so at least 7-10 days prior to the deadline. This is in order to account for the cheque processing and clearance time.
  • Limit credit utilization : Maxing up your credit card limit may help you in retail therapy but it is not a good idea when it comes to CIBIL Score calculations. It is wise to restrict your spending to not more than half of your credit limit. Such behavior indicates that you have a good control on your expenditures. People with strong spending discipline are more likely to pay back their dues on time.
  • Limited credit applications : Individuals who make multiple credit related enquiries within a short span of time are on the radar of lending institutions. It gives an impression that such individuals are perpetually on the lookout for credit. Hence, one should restrict the number of applications and enquiries.
  • Errors in credit reports : Sometimes you might be surprised to see a poor credit score in spite of following good credit practices. In such cases, one should carefully check their credit report. For instance, fully paid loans might be showing as unpaid due to some errors. Also, there could be some fraudulent practices that might have taken place on your behalf. It is important to check such activities or inaccuracies and report to the concerned authorities.

FAQs On CIBIL score for ICICI bank home loan

What are the Home loan rates of ICICI Bank?

ICICI Bank’s home loan rates are derived from the MCLR (Marginal Cost of Funds based Lending Rate) announced by RBI. Additionally, it also depends on the type of loan and the category of borrower.

The current rates are as follows:

  • Special loans up to Rs. 30 Lakhs

The interest rates are floating in nature. • Salaried individuals: 8.95% (Women) and 9% (Others) • Self-employed individuals: 9% (Women) and 9.05% (Others) Other loans Floating Rates: The interest rates are linked to One Year MCLR

  • Salaried individuals (Women):
    • Loan value up to Rs. 75 Lakhs: 9.05%
    • Loan value above Rs. 75 Lakhs: 9.1%
  • Self-employed individuals (Women)
    • Loan value up to Rs. 75 Lakhs: 9.1%
    • Loan value above Rs. 75 Lakhs: 9.15%
  • Salaried individuals (Others):
    • Loan value up to Rs. 75 Lakhs: 9.1%
    • Loan value above Rs. 75 Lakhs: 9.15%
  • Self-employed individuals (Others)
    • Loan value up to Rs. 75 Lakhs: 9.15%
    • Loan value above Rs. 75 Lakhs: 9.2% Fixed Rates for 2 Years or 3 Years
  • Salaried individuals (Women):
    • Loan value up to Rs. 30 Lakhs: 9.2%
    • Loan value between Rs. 30 - 75 Lakhs: 9.3%
    • Loan value above Rs. 75 Lakhs: 9.35%
  • Self-employed individuals (Women) o Loan value up to Rs. 30 Lakhs: 9.25% o Loan value between Rs. 30 - 75 Lakhs: 9.35% o Loan value above Rs. 75 Lakhs: 9.4%
  • Salaried individuals (Others):
    • Loan value up to Rs. 30 Lakhs: 9.25%
    • Loan value between Rs. 30 - 75 Lakhs: 9.35%
    • Loan value above Rs. 75 Lakhs: 9.4%
  • Self-employed individuals (Others)
    • Loan value up to Rs. 30 Lakhs: 9.3%
    • Loan value between Rs. 30 - 75 Lakhs: 9.4%
    • Loan value above Rs. 75 Lakhs: 9.45% Fixed Rates for 5 Years or 10 Years
  • Salaried individuals (Women):
    • Loan value up to Rs. 30 Lakhs: 9.35%
    • Loan value between Rs. 30 - 75 Lakhs: 9.45%
    • Loan value above Rs. 75 Lakhs: 9.5%
  • Self-employed individuals (Women)
    • Loan value up to Rs. 30 Lakhs: 9.4%
    • Loan value between Rs. 30 - 75 Lakhs: 9.5%
    • Loan value above Rs. 75 Lakhs: 9.55%
  • Salaried individuals (Others):
    • Loan value up to Rs. 30 Lakhs: 9.4%
    • Loan value above Rs. 30 Lakhs: 9.50 to 9.55%
  • Self-employed individuals (Others)
    • Loan value up to Rs. 30 Lakhs: 9.45%
    • Loan value above Rs. 30 Lakhs: 9.55 to 9.6% Fixed Rates for entire tenure
  • Salaried and Self-employed individuals (Women)
    • Loan value up to Rs. 30 Lakhs: 9.9%
    • Loan value between Rs. 30 - 75 Lakhs: 10%
    • Loan value above Rs. 75 Lakhs: 10.25%
  • Salaried and Self-employed individuals (Others)
    • Loan value up to Rs. 30 Lakhs: 9.95%
    • Loan value above Rs. 30 Lakhs: 10.05 to 10.3%

What is the eligibility criteria for getting ICICI bank home loan?

The following factors are taken into consideration while deciding the eligibility criteria for ICICI Bank Home Loan:

  • Regular and steady flow of income
  • Current and upcoming financial obligations
  • Age
  • Employment status and stability
  • Co-applicant’s details if applicable
  • Credit Score

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

If the low CIBIL Score is due to defaults in the past, then the likelihood of loan request rejection is higher. However, if it is due to other reasons, then ICICI Bank might still consider the application.

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

Yes. Defaults in repayment of loans severely impact the CIBIL Score of an individual. Misses or late payment of monthly dues pulls down the score significantly. This element has an approximate 30% weightage in the overall calculation.

Can I get more than 3 ICICI Bank home loans 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.

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