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How To Calculate Experian Credit Score For Home Loan?

How To Calculate Experian Credit Score For Home Loan?

If you seek housing finance, one of the first things that will likely come to mind is your credit score. Most potential borrowers understand the importance of a credit score for home loan. They also know that CIBIL awards a credit score or rating to individuals as well as businesses based on their previous financial history and debt percentage.

However, CIBIL is not the only authority that does this. Experian is another multinational credit reporting company with substantial standing in the Indian home loan market.

Experian brought its credit reporting practices to India in 2010 and is one out of four RBI licensed credit bureaus in India. It provides personal and business credit scores to borrowing and lending entities, which helps them receive approval for credit or loans.

What is an Experian Credit Score for Home Loan?

The Experian credit score is a three-digit code or number that ranges between 300 and 850. This rating range is the same, be it for credit score for home loan or business finance. Safe to say, the higher you rate on this scale, the better it is for getting approved for housing finance or any other type of loan you may seek.

This credit rating is a mark of a potential borrower’s solvency and creditworthiness. A high Experian credit score for home loan symbolises to a potential lender that you repay your debt without defaulting.

How to Calculate Credit Score for Home Loan by Experian?

Firstly, you cannot calculate your Experian score. You can only access it by visiting the Experian website, where they will calculate it for you after asking you to submit your loan and credit history. After which, you will find an automatically generated credit score. You can also download the credit report.

Therefore, the short answer to how to calculate credit score for home loan by Experian is that you individual can’t!

So, if Experian calculates your credit score, what factors does it consider for doing so? Here is how Experian’s credit score is calculated.

ParametersWeightageHow to satisfy these parameters?
Past payment history35%To keep this percentage up, you must: Repay all credit card bills on time. Pay all EMIs on time. Stay away from defaulting on any credit payment.
Credit utilisation30%To keep this percentage up, you must: Avoid exceeding your credit card limit often. Avoid maxing out your credit card every time.   
Credit history length15%To keep this percentage up, you must: Build a credit history by opting for a credit card. Show timely credit repayments over time.
Mix of credit10%To keep this percentage up, you must: Have a balance of secured and unsecured credit.
Newly approved credit10%To keep this percentage up, you must: Show recently approved credit through card or loan.

Now that you know how to calculate credit score by Experian, here are a few key summary points that can help you keep it up:

  • Pay all your bills on time. Nothing brings down your credit score like accumulated debt.
  • Keep your credit utilisation ratio under check. Don’t exceed your credit card limits.
  • Start building credit history early.
  • Keep a good mix of secured and unsecured credit, meaning where you have a personal loan; you can also show an old home or car loan, which was backed against collateral. 
  • Use a home loan calculator with credit score to figure out the kind of ROI you’re eligible for before availing housing finance. If your score is low, bring it up by undertaking the activities we have mentioned above and reply. 

How to Calculate CIBIL score for home loan?

CIBIL is a relatively more popular credit reporting authority than Experian. In fact, 90% of financial institutions have tied up with this authority for making hard credit checks for borrowers. It’s an ideal scenario where you have Experian as well as a CIBIL rating.

Again, the answer to how to calculate CIBIL score for home loans is that you individually can’t. You must visit the CIBL website, create an account, provide relevant financial details, and get rated instantly.

CIBIL has similar rating criteria as Experian. Here is a breakup of their parameters along with percentage weightage.

ParametersWeightage
Credit payment history30%
Credit duration and types25%
Credit Exposure25%
Miscellaneous factors like the number of unsuccessful enquiries, hard inquiries, credit utilisation ratio20%

To maintain a healthy CIBIL score, you must keep these percentages up. And for that, you must follow the same tips mentioned within the Experian table.

So, there you go! In addition to knowing how to calculate credit score for home loanthrough Experian, you are also aware of how to figure out your CIBIL score. Having both in your kitty is a great idea if you’re about to borrow a loan.

If you only want to go for one, we recommend picking CIBIL. The primary reason is that most institutions rely more on CIBIL rating than Experian. Even the ones that accept an Experian score often ask for an additional CIBIL score.

Also, how to calculate CIBIL score for a home loan is a straightforward and instantaneous process.

The Final Word

After checking the score from CIBIL, home loan eligibility calculator must be used. It’s not mandatory but having a high CIBIL score is never the sole criterion for getting approved for housing finance.

Using a home loan eligibility calculator and CIBIL score together provides you with an accurate idea of the rate of interest you are most likely to get approved for.    

Are you looking for housing finance? If so, then turn to Tata Capital! We offer home loans at affordable interest rates, flexible repayment tenures and minimal documentation. Visit our website to use a housing loan calculator or log in to the CIBIL website to use the CIBIL home loan calculator and start your application today!

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