CIBIL: 4 ways in which credit score affects your rental applications
CIBIL score, can indirectly affect your rental applications in a number of ways. Although it does not have any bearing on rental applications in the unorganised market, but some landlords in big cities such as Mumbai and Delhi may consider the credit (CIBIL) score as well of tenants to determine their creditworthiness. They may use the CIBIL score as one factor to assess a tenant’s ability to pay rent on time.
A higher credit score can be seen as an indicator of responsible financial behaviour, which may increase your chances of being approved for a rental property. Rental application: Some landlords or property management companies may have specific criteria for approving rental applications, which may include a minimum credit score requirement. For instance, some property company may reject the application of tenant whose credit score is below 600.
Security deposits: In some cases, landlords may require a higher security deposit or impose stricter lease terms for tenants with lower credit scores. This is because they perceive a higher risk of late payments or default on rent payments from individuals with lower credit scores. ALSO READ: How to improve your CIBIL score with a personal loan? Here are 4 ways Co-signer: If your credit score is low, the landlord may request a co-signer with a higher credit score to guarantee the lease agreement.
This gives the landlord with added assurance that rent payments will be made on time. Rental market: In competitive rental markets, some landlords may have the option of choosing tenants with higher credit scores over the ones with lower scores. A higher credit score can give you a competitive edge in such situations.
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