New Delhi, Dec. 11 -- As auto demand remains strong across the country, an increasing number of aspiring buyers are turning to vehicle financing. This makes it essential for borrowers to understand one key factor: Does applying for a car loan affect their credit score?

Focus must be laid on understanding the implications, i.e., the pros and cons of applying for car loans based on the credit scores of the applicants and their long-term financial health. So that proper borrowing decisions can be made.

Every single application for an auto loan results in the lending institution performing a hard inquiry on the borrower's credit profile with the major credit bureaus. There are basically four credit bureaus in the country: CRIF High Mark, CI...