Wednesday, June 23, 2021

Easy Ways to Improve Your CIBIL Score

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CIBIL Score is a three-digit number that depicts your credit records. The credit score is assessed by the information given in your credit report. The CIBIL score fluctuates from 300 to 900. A high score indicates your healthy credit profile. So, the closer the number to 900 more beneficial it is. If you have a score near around 300, there are high possibilities that banks might reject your loan application.

A credit score is the most significant factor that limits your creditworthiness while availing of a loan. A healthy credit score will approve your loan application process faster. It is desirable to have a good credit score to get the loan facility. If the credit score is less, you can easily improve it, which will better your chance of getting loan approval. Although it is a long process, usually it takes 4-12 months, depending on the situation. Generally, Credit Score above 750 is the best score to avail loan. If the score is less than 600, it will take some time and effort to increase your score to 750.

Here are some ways to improve your CIBIL score perfectly:

  1. Repay your all dues on time: You need to be accurate while paying the EMIs. If you delay the repayment or EMIs, you are bound to pay some penalties and, your credit score will also degrade. So, it is crucial to pay all dues on time to get a good credit score.
  2. Check your credit report frequently: Checking your credit report allows you to see information about yourself given by credit agencies. If there is any inconsistency, particularly about defaults or delays in payments, you can raise a dispute to agencies to correct your information within 30 days. Fixing these errors will increase your credit score definitely.
  3. Maintain a strong credit mix: It is always recommendable to have a healthy mix of unsecured loans and secured loans. A person with high secured loans is favorable to the banks and, the bureaus also assign a suitable credit rating to them. 
  4. Clear your all past credit cards: Lenders generally explore those people who have certain financial performance. One can achieve a good financial reputation by clearing all credit card dues that directly improve your credit score.
  5. Avoid becoming a joint account holder:  Any default in repaying the loan or EMIs by the other party will directly affect your CIBIL score.
  6. Avoid applying for multiple loans at once:  Getting many loans during a time proves that you do not have enough funds to repay the loans. It is more beneficial to get one credit at a time to pay it easily on time.
  7. Check your credit utilization: it is not advisable to utilize your credit card to its greatest limit. Generally, it should be under 30% to get a good credit score.
  8. Enhance your credit limit: As per your current credit score and your card usage, banks systematically give you an offer to increase your credit limit. It is not compulsory to accept it. However, doing it so, can boost your credit utilization ratio and will boost up your credit score as well.

The above methods will eventually enhance your credit score. However, it is not prompt and can take some time to get the appropriate credit score, depending on the nature of inquiries in a credit report.

All you require to be is intelligent, calm, and calculative while utilizing money.

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