Have you ever been denied a loan in India
If yes, then you ever wondered what the Reason was? The Reason was your Credit score; You should Check your Credit Report at least once in a year. If you find it low, you need to take immediate action to improve your credit score.
Whenever you apply for the loan, Banks will check your Past details, Consistency of repayment. Your repayment record decides your credit score. So, your record will work as a judgment factor, which will play a significant role, while issuing a loan.
Reserve Bank of India also made it mandatory to check the CIBIL Score, of loan applicant before Sanctioning them a loan. So, the foremost thing to apply for a loan and get it sanctioned is to have a good credit score.
What is a Credit card & Credit Score?
Credit card is a short term loan given by the bank for a fixed period, and one has to repay it. Otherwise, it will charge late fees. A credit score is a digital score that explains your credit history, and it helps to get an individual’s loan approved. It will rely on numerous factor.
Tips to Improve your Credit Card Score:
- Spend within Limits– It happens when we went for shopping our greediness for buying increase after seeing good stocks. As a result, we end up buying more. Ever try to spend within limits and always repay within the given period and avoid Extra Interest, as it makes Credit score low.
- Limit your expenses– Make it a habit, do shopping when there is no need or when you are not hungry for shopping as it will help you to save the right amount of money. Try to limit your expenses; purchase only required goods. Otherwise, you end up with more debt to pay as you forced yourself to use a good number of credit cards.
- Pay your EMI on time-Try to keep your debt repayment slot in green, as lenders consider it while issuing a loan. Your credit score is a deliberation of your ability to pay back debts effectively. From a lender’s perspective, established the history of timely payments is a good indicator you’ll handle future obligations responsibly, too. Always pay your EMI’s on time, Set a Reminder, and follow a strict time table.
- Oldest Credit card- Try to maintain your oldest Credit Card, as it will have all of your past details. More extended Credit history is better. As oldest credit card will have the record of an earlier transaction. Do not apply for a credit score if you don’t need them.
- Leave old debts on your report- Usually, when we get rid of education loans, we will try to vanish that trace from our story. But I will recommend you to keep it as a record if you regularly pay your debt. As it will become proof of your Consistency. Try to check your CIBIL report at least once a year. Get Closure documents from the loan company when you clear all loans.
- Be Patient- You won’t raise your credit score overnight, which is why one of the Establish good habits, like paying your debt on time, increase your credit score and applying for credit only when you need it, and you should see those practices reflected in your score over time, best ways to achieve an excellent rating is to develop good long-term credit habits.