Difference Between Credit Score and Credit Report
Having a decent credit score is a must these days. it’s tough to avail of a loan just in case of poor or bad credit scores. But, the question is that how do the lenders come to know whether or not you’re repaying o time by simply gazing the credit score?
Even borrowers don’t know the difference between credit score and credit report. But, it’s important to know the difference between credit score and credit report.
Credit Score is the variety that comes by using the data in your credit records submitted by all of your lenders to the agency. It’s a numeric price at a point of your time that helps lenders to assess the credit risk related to lending cash to you. A better credit score means a lower risk of default for the investor.
In India, a score between 750 and 900 is treated as a decent credit score by the lenders. This score is predicated upon a spread of things like your compensation history, credit utilization data, details of the loan, etc. This score keeps ever-changing with time.
If you service your loans on time, then the score improves. Whereas it decreases if you fail to repay the loan in time and spoils your credit profile. The score doesn’t give the other data to the investor.
A credit report could be a document that additionally includes your credit score. This report shows a good vary of data like name, gender, age, address, the PAN card variety that defined you. It additionally defines the loans you’ve got applied for and also the repayment history too. If you’ve got defaulted on any loan, then it’s additionally shown within the report.
It additionally enlists the number of inquiries that are the number of times lenders has accessed your credit report whereas assessing your loan request. A credit report is much informative compared with a credit score.
A credit score simply provides a numerical price, whereas a credit report provides additional qualitative and quantitative inputs to the investor. It helps lenders to require a wise call while providing the cash. Hence, it is of predominant importance that you just keep track of your investments and liabilities.