4 Tips to Build a Good Credit ScorePurchase & Refinance Mortgage LoansUpdated on Apr 21, 2020 View more like this | Visit India, UN | Contact Arwind Sharma |
A poor or average CIBIL score can cause you to lose out on good schemes, offers, and lower interest rates when you seek finance. On the other hand, having a high credit score of 750 and above will allow you to enjoy various benefits such as faster approvals and competitive interest rates. However, it is important to note that your credit score is a sum total of several factors such as your past repayment record, number of loan inquiries, credit utilization, etc. So, in order to boost your CIBIL score, take a look at the various measures that you should implement.
Repay Pending Dues and Existing Loans
Pending dues such as loans and credit cards burden your finances and eventually bring down your credit score. Try clearing them by using surplus cash such as a bonus or income from investments. In case of unavailability of such funds, you can avail a personal loan to consolidate and clear your debt.
You can choose a instant Personal Loan to clear your debt with one EMI. most of the lenders offer personal loan at lower interest rates. Here, the main advantage is that you can repay all your existing loans at once and be left with the responsibility of repaying one, low-interest loan over a comfortable tenor of 12 to 60 months.
Make Fewer Loan Enquiries
Ensure that you make inquiries about loans and credit cards only when you plan to apply for one and are sure to a certain degree that you will qualify. Enquiring haphazardly will only bring down your credit score, as you get marked for each inquiry you make. Further, applying without checking your eligibility may lead to rejection, which also contributes to a drop in your CIBIL score. So, before applying, always visit the lender’s website, compare products on offer and check your eligibility in minutes using a loan eligibility calculator.
Balance Your Credit Utilisation Ratio
Your credit utilization ratio should never exceed 30%. This ratio measures the gap between the utilized credit and the credit limit. Exceeding your credit limit will lead to a high credit utilization ratio and as a result, reduce your CIBIL score. Also, expanding your credit limit based on your utilization will help you maintain a low ratio and as a result, a higher CIBIL score. Exercise the latter option only if you can’t reduce your credit utilization and end up using the entire limit regularly.
Pay Bills and EMIs on Time
There are several rules that apply to the repayment of your loans and credit cards. For instance, your EMIs come with a deadline. Once you cross it, you will be charged a late payment fee and/or penal interest. Also, your CIBIL score will automatically decrease. Hence, it is important to keep track of EMI deadlines by setting reminders so that you can avoid such penalties and build a good credit score.
These are some ways in which you can increase your CIBIL score and improve your chances of taking a loan in the future. However, before you apply for a loan, personal loan calculator help you to check your loan EMIs in advance. This will help you prepare for loan repayment better. In case you are keen on availing a personal loan quickly, be sure to check your pre-approved offer to access funds faster. All you have to do is enter a few details and get your pre-approved offer.
Pending dues such as loans and credit cards burden your finances and eventually bring down your credit score. Try clearing them by using surplus cash such as a bonus or income from investments. In case of unavailability of such funds, you can avail a personal loan to consolidate and clear your debt.
You can choose a instant Personal Loan to clear your debt with one EMI. most of the lenders offer personal loan at lower interest rates. Here, the main advantage is that you can repay all your existing loans at once and be left with the responsibility of repaying one, low-interest loan over a comfortable tenor of 12 to 60 months.
Make Fewer Loan Enquiries
Ensure that you make inquiries about loans and credit cards only when you plan to apply for one and are sure to a certain degree that you will qualify. Enquiring haphazardly will only bring down your credit score, as you get marked for each inquiry you make. Further, applying without checking your eligibility may lead to rejection, which also contributes to a drop in your CIBIL score. So, before applying, always visit the lender’s website, compare products on offer and check your eligibility in minutes using a loan eligibility calculator.
Balance Your Credit Utilisation Ratio
Your credit utilization ratio should never exceed 30%. This ratio measures the gap between the utilized credit and the credit limit. Exceeding your credit limit will lead to a high credit utilization ratio and as a result, reduce your CIBIL score. Also, expanding your credit limit based on your utilization will help you maintain a low ratio and as a result, a higher CIBIL score. Exercise the latter option only if you can’t reduce your credit utilization and end up using the entire limit regularly.
Pay Bills and EMIs on Time
There are several rules that apply to the repayment of your loans and credit cards. For instance, your EMIs come with a deadline. Once you cross it, you will be charged a late payment fee and/or penal interest. Also, your CIBIL score will automatically decrease. Hence, it is important to keep track of EMI deadlines by setting reminders so that you can avoid such penalties and build a good credit score.
These are some ways in which you can increase your CIBIL score and improve your chances of taking a loan in the future. However, before you apply for a loan, personal loan calculator help you to check your loan EMIs in advance. This will help you prepare for loan repayment better. In case you are keen on availing a personal loan quickly, be sure to check your pre-approved offer to access funds faster. All you have to do is enter a few details and get your pre-approved offer.
