How your credit score can be improved? – Most of the times people have no idea how important it is to maintain a good credit score, unless they run into some problems because of their bad credit score. It is a well-known fact that people with credit score above 750 have better chances of getting accepted for credit. There are so many people who get rejected because of low credit score and become committed to financial discipline after rejection.
Those people who are financially disciplined have no issues in improving their credit score. However, it can become a mission impossible for those who have no control on their finances.
The Indian economy is inclining towards risk-based lending, which makes it even more crucial for every individual to be financially disciplined. Otherwise, they may lose big this time. Moreover, it is not impossible to achieve financial discipline.
The first step towards becoming financially disciplined is to learn about your credit score. Without further ado, let’s move to procedure of procuring your credit score information.
There are three important credit bureaus in India –CIBIL, Experian, and Equifax. Each of them has a different way of giving score to the customers. CIBIL score ranges from 300 to 900, Equifax scores between 1 to 999, and Experian scores lie between 1 and 1000.
Whenever someone applies for a loan, his/her application is passed through the credit score test. Credit scores below 600 have high chances of rejection. A score between 600 and 750 may lead to further scrutiny for assessing the credit risk associated with the applicant. A credit score above 750 has the highest chances of acceptance without any further assessment.
Check your CIBIL credit report
- Go to cibil.com
- Choose any one plan from the three plans.
- One Month – 550 INR
- Six months -800 INR
- One Year – 1,200 INR
- Fill the application form and provide an ID
- Make Payment and then accept the conditions to avail your CIBIL credit score.
For other credit bureaus, you can simply go to their online portals and follow the steps to get your credit score report.
Now when you have finally obtained your credit score the time is to look at ways to improve it.
Manage your credit cards
Some people like to show off their credit cards and have various different cards in their wallet. Such behavior is a no for a lender. It is a simple indicator that you are hungry for credit and it looks bad on someone’s credit history.
So if you have more than two cards then close them immediately. Keep those which are old because they improve credit score.
This is the most crucial thing in maintaining your credit score. Not only you will have to pay big next time but your repaying ability also gets questioned.
Pay the dues in full
Try to clear your balance every month rather than just making minimum repayment. Banks don’t like that there is balance payment carried over months.
Do not use full credit
Credit utilization is inversely related to credit scores, that is why you should keep your utilization on the lower side.
Finally, if you have no clue about your credit score or you have a bad one, then it is time that you work upon your financial discipline and improve your score.