credit score
In this era of inflation, people do not have the same savings as before. In such a situation, loan is required for big works. But if your credit score is not good, you may face problems in getting a loan. In such a situation, it is important to keep your credit or CIBIL score strong. This increases the credibility of your loan repayment. Today we are going to tell you some things, by adopting which you can increase your credit score.
What is a good credit score?
Credit scores range from 300 to 900. TransUnion CIBIL is one of the four credit bureaus in India that prepare credit score reports. The closer the CIBIL score or credit score is to 900, the better it is considered. A score between 300 and 549 is considered the worst. Similarly, a score between 550 to 700 is considered fair.
Do not take multiple loans at once
Try to keep the number of loans taken in a fixed period to a minimum. To avoid lowering of CIBIL score, repay one loan and then take another. If you take out multiple loans at once, it will show that you are stuck in a cycle where you don’t have enough money. The result of this will be that your CIBIL score will reduce even further. At the same time, if you take a loan and repay it successfully, your credit score will increase further.
take a long term loan
Keep in mind that whenever you take a loan, try to choose a longer period for repayment. This will ensure that your EMI is low so that you can make payments on time. Your credit score will improve when you do not delay or default in paying EMIs.
Pay EMI on time
Repayment of your outstanding loan can have a significant impact on your credit score. In such a situation, you need to maintain discipline at the time of EMI payment. Delay in EMI payment makes you pay penalty and your credit score decreases.
Keep old credit cards active
If you have old credit cards, you should keep them as long as you can pay your bills in full on time. This will help you build a solid and long credit history, which will help you increase and maintain a good credit score in the future.
Customize credit limit
Your credit utilization ratio has a significant impact on your credit score. The more you are able to restrict your credit usage to a set limit, the better it will be for your credit score. Reaching the limit has the opposite effect as it lowers your credit score. One way to deal with this is to contact your bank and customize your credit limit based on your expenses.
Latest Business News
