Procedure that individuals who maintain a credit score of 750+ follow

There is no doubt that a high or good credit score can make a significant impact to your financial life. It can offer you the best interest rates on loans and get your credit card application approved. In some countries globally, even prospective employers and insurers go through a person’s credit report to determine their creditworthiness. You never know when bagging your dream job is the result of a good credit score!

So, does it mean that there will never be a loan for low CIBIL score? Well, not exactly, but such a loan does not come at the best terms. For instance, you can wind up paying a much higher rate of interest than you would if your score had been higher.

What is a credit score?

We know what a credit score does and how important it is, but let’s take a quick look at what constitutes the credit score, shall we? It is a numerical representation of your credit report, an all-important document generated by a credit bureau. There are currently four credit bureaus in India, each offering a report. A score ranges between 300 and 900, and a higher score is always a plus point.

Lenders consider a score of 750 and above a near-perfect score. This score essentially gives them the comfort of lending to a creditworthy individual and that’s what makes the score so important. How about calling for your free CIBIL report to know where you stand currently?

Factors that determine the credit score

Let’s take a diagrammatic look at the factors which determine the CIBIL score:

Keeping these factors in mind, your next step is to understand how to get a good credit score – and keep it that way.

How to get a good credit score

So, what is it that people who consistently have a high or good score of above 750 do regularly? Is it something drastically different? Here, we clue you in on their habits so that you too can work towards building and maintaining a similar credit score. Read on!

  • Payment history: It is crucial to make timely payments, so once your loan EMI or card statement is due, pay off the amount on or before the due date without fail. Remember that a delayed payment – or one that is skipped entirely – can pull down your score drastically. If you look at it from a lender’s perspective, they would not want to extend further credit to someone who doesn’t manage their existing debt well. So, set up payment reminders or avail of an ECS facility to maintain a clean repayment track record.

  • Manage your credit utilisation: While the credit utilisation limit is calculated across all your accounts and not just on a single credit card, remember that it is prudent to stay well within a utilisation ratio of 30 percent. A higher usage indicates that you could be in a spot or more of financial trouble and are heavily dependent on debt to manage your finances.

  • New credit: Every time you apply for fresh credit, a hard enquiry is made against your CIBIL report. While temporary – say for a few months – each such enquiry will drag your score down a little bit each time. So, ensure that you apply for a fresh line of credit – be it a loan or card – only if you absolutely need it. This also helps you stay away from unnecessarily walking into a debt trap.

  • Old accounts: Like the saying goes, old is gold! But, in this case, only if it is an account you’ve managed well, such as a credit card that has always had good payment history. Even if you don’t use this card at present, don’t close an old, good account. This can add weightage to your credit score.

  • Apply for a credit card: If you’re a first-time entrant to the financial world with no credit history whatsoever until now, this is the time to apply for a credit card. This can be your first step towards building a robust credit history. Do make sure that you pay on time and ideally in full, so that the card proves to be an asset over the long run, as far as your credit score is concerned.

  • Manage a healthy credit mix: When your score is calculated and also when a potential lender looks at this score, they’re happy to see a report that contains a well-balanced mix of all types of credit. This could include both secured and unsecured loans.

Your next steps

Now that you’re aware of what a high credit score can do for you, don’t forget to request for a free CIBIL report at the earliest. To take charge of your financial health it’s important to know just how your credit report fares. Remember that there will likely be a loan for low CIBIL score with some financer offering the option, but that is not the place you want to be.

Take charge of your financial health starting now!

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Do banks check the CIBIL score before loan approval? Here’s what you should know!

Your credit score is a huge determining factor when it comes to loan approval. It is one of the first things that a bank or financial institution checks when you approach them, making it an important aspect of your financial life that you just can’t afford to ignore. Of course, your complete profile will also be considered, but do take special care of your score.

A good starting point would be to get a free CIBIL score from the credit bureau so that you know where you stand. This is an especially crucial step prior to loan application. Read on to know more about the credit score, and how it impacts you.

What is a credit score?

A three-digit number between 300 and 900, the credit score is generated by a credit bureau. It is a crisp overview of your credit report, which tells a lender about your creditworthiness. A high or good credit score can open doors in the financial world for you, when it comes to making an application for a loan or credit card. While every lender’s criteria may differ slightly, there is no doubt that a score of 750 and above will make anyone sit up and take notice!

What goes into a credit score?

Wondering what are the parameters at play when it comes to your credit score? Read on to know more!

  • Payment history on past as well as current loans and credit card accounts

  • New credit that you have availed of

  • The length of credit history, i.e. how old your accounts are

  • A credit mix, which consists of various debt products

  • The credit utilisation ratio, which indicates just how much you seem to rely on credit

Other factors that banks consider

In addition to the credit score, banks also consider certain other factors such as your income and the amount you currently owe on existing loans and credit cards. They also look at the amount of loan you have requested for, together with the loan tenure. Whether your application is for a secured or unsecured loan will also have a role to play, especially keeping in mind your income and expenses.

However, here’s why the credit score is important. Say for instance you apply for a personal loan for low CIBIL score. Here, a bank may not reject your application outright because of the other factors being considered. However, a low score may not give a lender the confidence to offer you the best rate of interest since they too need to hedge their bets.

How to improve your credit score

Given the above, you’d agree that it is indeed important to make sure that your credit score is not just high but that it remains that way as well. Here are some crucial tips that should help you on your journey to improve your credit score.

  • Making payments in time: Being late on your credit card and loan payments can pull your score down. The situation is further complicated if you skip making the payment entirely, as this looks alarming from a lender’s perspective.

  • Do not default on loans: Charged off or settled loan and card accounts reflect negatively on your credit report, as do accounts that have gone into collections. Do make sure that you work out a solution to repay existing debt if you don’t want your score to dip drastically as a result of these charges.

  • Maintain old credit cards: Don’t shorten the length of your credit history if you have a good, old card account. If you have maintained it well by ensuring timely payments, this can in fact give your score a boost.

  • Applying for fresh credit: It’s simple, really – if you don’t need a loan or card, don’t apply for one! Not only does it make you look like you’re constantly in need of credit within a short interval, but every such application results in a hard enquiry on your credit report. This impacts the score, albeit temporarily.

  • Apply for a credit card: The above doesn’t hold true if you want to start building a credit score, however! Apply for a new card and be sure to use it prudently – this can instantly help boost your credit score.

  • Check your credit report: At regular intervals, do make sure that you check what’s in your report, because any erroneous or inaccurate information can prove detrimental to your score. Further, you need to make sure that every account mentioned therein belongs to you – protect yourself from identity theft even as you protect your credit score!

In conclusion

It’s important to remember that while a personal loan for low CIBIL score is not impossible, it is also not optimal at the same time. Instead, with some perseverance and patience it is better to improve your credit score.

Start with availing a free CIBIL score from a credit bureau today, so that you can take charge of your financial health confidently, now and well into the future!

Good Credit Score is Beneficial for Instant Loan Approvals

People take loans all the time- home loans, personal loans, auto loans- the options are plenty. However, the process of applying for a loan and actually receiving the funds is a long and tedious one. There are many people who don’t get loans at all, even after numerous attempts. So, what can you do to get a loan as quickly as possible? If there is one thing that you can do, then it has to be credit score improvement!

How Does Good Credit Score Benefit Loan Applications?

When a bank receives a loan application, then it checks a variety of things before approving the same. These include the applicant’s repayment history, existing debt, credit utilization ratio, length of credit history, etc. However, the most important thing that it considers is the credit score.

Your credit score lets the bank know how high your creditworthiness is. So, if your score is low, then it would suggest that you face problems with credit and personal finance management. However, if your score is high, then it would know that it can count on you for the loan’s repayment and that the risk of defaulting is minimum. Hence, it would approve your loan application rather quickly.

Apart from instant loan approvals, high credit score also helps in the following ways:

1. Better Rates

If you seek more affordable loans, then you have a very good reason to increase credit score. This is because those who have a good score are able to get lower interest rates from the banks. When your score is high, then you know you have the leverage at the time you want to negotiate with the bank. You can urge the lender to offer better interest rates in light of your good track record as evident by the good rating. More often than not, they agree without giving you a hard time.

2. Bigger Loans

As the loan amount increases, so does the risk for the lender. So, if you want a big loan, then you can increase the odds of getting approval by checking your free credit score first. If you see that your score isn’t up to the mark, then you can work on it before you submit the applications. Otherwise, when you need a loan on an urgent basis, then you might be able to get only a small portion of the same from the bank.

3. More Options for Jobs

You may find it surprising but many companies, especially in the finance domain, now review the credit reports of the candidates who appear for jobs. Usually, they check if they i.e. the candidates have ever defaulted on a loan in the past or if their score is up to the mark. The idea behind this measure is that if someone has a bad credit history, then they are also unlikely to be suited for a professional job. This again has to do with the usual association of bad credit rating with personality traits like lack of discipline, time management problems, etc.

You may not necessarily be judged on the basis of your credit rating when you appear for job interviews. However, if you don’t want to take any chances, then it’s strongly recommended that you increase credit score as much as possible before proceeding.

4. Higher Credit Card Limits

Most credit cards come with fixed limits and you can only spend within these limits and not a penny more. Naturally, you would want the highest limits possible so that when you are in a cash crunch or in case there is a financial emergency, then you can use your credit cards for help. Now, here is the thing- the lenders are usually more willing to increase the limits when the users have a good credit rating. So, if it’s high credit limits you seek, then you should check your free credit score today itself and see if it needs some improvement.

As you can see, there are numerous benefits of a good credit score. So, if you ignored yours so far, it’s time to take control and make improvements. Always remember- a good rating will help in your entire life!

Worried About Life After Retirement? Get Income in Your 60’s

Planning your retirement doesn’t have to be challenging. There are many ways to boost your savings for the twilight years and live life comfortably even after you have retired from your job permanently. The following are some of the best options to consider:

1. Senior Citizen Savings Scheme (SCSS)

SCSS is one of the most popular savings schemes for retirement as offers a high interest rate of 8.4% and also allows for tax deduction at the time of investment. However, there is one downside to this scheme which is that the maximum amount that you can invest is Rs. 15 lakhs. If your spouse also invests, then the limit can be increased to Rs. 30 lakhs.

2. Public Provident Fund (PPF)

The Public Provident Fund (PPF) is another popular long-term investment plan which has a tenure of 15 years. It offers a tax-free interest rate of 8% which is compounded, meaning that the returns are quite high. Also, both the principle and interest are supported by sovereign guarantee to make it a safe investment.

3. Atal Pension Yojana (APY)

If you are within the age group of 18-40 years, then you can invest in Atal Pension Yojana i.e. APY. As the name suggests, it’s a pension scheme in which you can deposit money on a regular basis to receive a regular pension after you retire. You get the option to receive a monthly pension of Rs. 1,000, Rs. 2,000, Rs. 3,000, Rs. 4,000, and Rs. 5,000. If you pass away during the tenure, then your spouse can receive the pension instead.

Apart from the popular investment schemes that are discussed above, you can take certain measures to save more money for your retirement:

Take Loans Once When You Have to

It’s possible that from time to time you may need to take a small business loan or personal loan. However, you should be careful with debt, especially when you are close to retirement. So, take a loan when you have no other option. Also, try to clear all your debt by the time you turn 60 and avoid getting lured by attractive interest rates or pre-approved loans that your lender may offer you on the account of your good credit score.

Take Care of Your Health

Staying healthy becomes more and more important as you age. Not only poor health affects your lifestyle, but it can also make a big dent in your savings that you might be saving for your retirement. So, try to improve your diet, exercise on a regular basis, and take measures to lower stress as much as possible.

Educate Yourself on Investments

There are all kinds of investment options depending on your budget and requirements. While there are standard pension schemes that are discussed above, there are other options as well which include mutual funds, stocks, bonds, etc. You can earn a lot more through these options, granted you know what you are doing. So, whenever you get free time, try to learn more about these investments and how you can maximize your earnings.

Protect Your Credit Score

Your credit rating is something that you need to protect all your life. This is because the score affects everything- the interest rate on a home loan, business loan, credit cards, etc. also your job prospects. You may have to pay high health and auto insurance premiums if the insurer checks your credit score before calculating the amount.

Save on Taxes

Did you know that there are many ways you can reduce your taxes? For instance, if you are investing in PF scheme, 5-year tax-saver fixed deposit accounts, etc. and paying a premium for health insurance, etc. then you can deduct these amounts from your taxable income and pay fewer taxes to the government.

Bottom Line

It’s understandable if you are anxious about your retirement. When you are old, then it becomes difficult to do lots of things that you are able to do today without any problems. However, financial planning can make your twilight years safe and stress-free to a huge extent. This is why it’s best to start working on a roadmap as soon as you can. Good luck!

High credit score can get you a cheaper personal loan

One of the best loans which are available in the market is a personal loan. With no strings attached to it, you can use the funds in any way you want. Despite of having other loan options like car loans, bike loans, loan against property and many more, people are taking personal loan to satisfy their needs and wants. It is so easy to avail one that you get your loan sanctioned within minutes. In some cases you already have a pre-approved loan available towards your account and you can get it with a few clicks and voila, you get the money credited towards your account.

Want to have the above scenario with yourself? Did you just logged in to your bank account just to check if you have a pre-approved loan offer? Not many banks offer such service unless you have an account with HDFC. HDFC personal loan is the best and they offer the best there is in the market. Apart from the banking irony, what is more important for such kind of a privilege is your credit score.

A credit score plays an important role when it comes to loan sanctions. On the other hand if you have a high cibil score, is rest assured that the offers will keep rolling in towards your account and you can use these offers at your ease. Not only will you get a loan on a cheaper interest rate, but also you will get the best personal loan offers.

What is the range of a great cibil score?

A typical credit score falls in the range of 300-900. You are considered to be a good profile if you happen to have a score above 750. But on the other hand if you are in the range of 800 and above you are considered to be the best of loan eligibility and the lenders will be always after you offering great financial products.

Benefits of high cibil score

You are always a first customer to be offered a loan if you need one. The lender has special rights for people with high score and they are considered to be a valuable customer. Not only this, when you opt for a loan, you have the power to negotiate terms with the lender all by yourself. You can negotiate on the processing fees and also the interest rates. You can set terms with the lender and get the loan processed according to your will.

How to improve your good cibil to best cibil?

Well, the answer to this is it will take a lot of time to get through to a great cibil. If you have been a defaulter in the past or you have a settlement towards your report, you can simply kiss your dream a goodbye because defaults and settlements stay on your report for a very long time.

On the other hand, you can start building your credit by making all your payments on time, fix errors on your credit report if you find any, increase credit limit of your credit card and so on. You can still get a loan for low cibil score in the market but you will encounter a lot of problems and you will end up paying high processing charges and high interests on the loan as compared to market standards.

A great cibil score comes with a lot of dedication and financial integrity. A lot of us just pay the minimum due amount every month thinking this will not affect the credit but unfortunately it does and you end up not only paying the late charges and interest but also your financial peace.

 

Six easy hacks to improve your credit score from bad to good

Your credit score is a representation of your financial health, which is what makes it important enough for you and sit up and pay attention. With a healthy score, you can look forward to a healthier financial life as well, and avail the best offers on loans and credit cards. Otherwise, getting a loan for low CIBIL score can be quite a challenge!

If your credit score is currently not up to the mark, do not fret. We’re here to help you improve your score from ‘bad’ to ‘good’. These six easy hacks should get you started. Read on to know more.

Tips and tricks to work on your credit score

  1. Make timely payments: First things first, pay your bills on time each month as they arrive. There’s nothing like bills paid in full to make a prospective lender look at you positively. Payments when made on time and ideally in full, look great on your CIBIL report as well. Paying up late or less than the total amount due also impacts your score negatively, so do keep that in mind!

If you find it tough to keep track of which bill needs to be paid out when, how about setting up calendar reminders or alerts on your mobile phone? And yes, if you have any previous bills outstanding, consider paying those off as well.

  1. Don’t apply for too much credit: While your wallet may look impressive when it is spilling over with multiple credit cards, what isn’t so impressive is the impact this has on your credit score. The reason being, each time you apply for a new credit limit, the lender makes an enquiry about your credit score. Each such hard enquiry can negatively impact the score. It’s pretty clear, then – don’t make applications unless you really require that additional card or loan.

  1. Stay well within your credit limit: While larger credit limits are tempting, remember it’s also that much easier to utilise them. The trick to staying credit healthy includes staying well within your credit limit. Using around 30 percent of your credit limit or less is ideal, by the way, for your score to get a boost. On the other end of the spectrum is the danger of maxing out your card limit, so do track what you spend! The lower the balance, that much better is your credit score. In short, know what you are spending before the ratios get skewed.

  1. Track your score: It’s no secret that monitoring your credit score is one of the best things to do to bring your score up. Let’s see what all this does for you, shall we? For starters, you’ll be able to know how you’re faring when it comes to credit usage. Experts recommend that you check your score once a year, but there’s no such rule set in stone. In fact, it’s recommended to check your score more often, especially if you’re planning to apply for a housing or car loan. Secondly, you’d know immediately if there is any inaccuracy in the report. Which brings us to the next point; read on!

  1. Report any inaccuracies on your report: This is where monitoring your report comes in, and is an important activity. There have been instances wherein an individual’s credit report reflects information pertaining to someone else – which can impact the credit score negatively. To cite an example, if a person has a poor repayment track record and the same reflects erroneously on your CIBIL report, rest assured that this information will pull your score down. Make sure, then, that your report contains only your data and no one else’s.

  1. Don’t erase past records: It doesn’t matter if you’re not using the credit card that you’ve had for a while. As long as your payment history on that card is good, with payments made on time and in full, your credit card can help boost your score. It’s pretty simple – when a lender is looking at your credit history, they are encouraged to see a prospective borrower who comes with a robust financial history. Having this backing only makes your subsequent applications for loans and/ or credit cards stronger.

And finally…

Establishing and maintaining a good credit score will always be to your advantage. A few good practices like those mentioned above can ensure that you’re not stuck trying to get a loan for low CIBIL score. Instead, you can avail of the best deals when your score is healthy.

Remember that repairing your credit score is not an overnight task. Taking it from ‘bad’ to ‘good’ needs time and patience. Your best bet to go about it, is to establish good credit habits. Be practical in your approach and over time, you should see the results of your hard work pay off.

Let’s find out interesting facts about credit score that you didn’t know

Credit score itself is an interesting topic. The whole logic, algorithm, how is it calculated, what factors are associated with it. All becomes one big score that is required to check the creditworthiness of an individual when he or she has applied for a loan or credit card to either the banks or the NBFCs (Non-banking Financial Institutions). For the basics, A Credit Score is a three digit number ranging between 300-900. Where 300 is the lowest and 900 is the highest. The score between 750-900 is a good score. Between 600-750 is considered as an average score and anything below 600 is bad.

There are four credit bureaus in India who gives credit scores. CIBIL (Credit Information Bureau India Limited), Experian, Equifax and CRIF Highmark are these four bureaus. These credit bureaus have the authority to access an individual’s credit history as they have the communication channel set with the banks and NBFCs (Non Banking Financial Institutions) who passes the information of when was the loan or a credit was applied to when it was approved to when it was disbursed and finally when they do they start repaying. Any missed or delayed payments, are all recorded and obviously which affect the score!

Payment History, Amount Owed, Credit Mix, Length Of Credit History and New Accounts are the five factors of which the credit score is made! We all know that. We have read many times about these criteria or the parameters and how they can make or break the score. The free CIBIL Score that is offered also helps anyone know the score and a detailed report wherein one can check the mishaps that must have happened if the score has gone low or anything related. But let’s know a few things beyond that. And what are other factors that one can take care too!

The first that comes is the credit utilization ratio:

What is the credit utilization ratio?

If you are a credit card user, you would know that there is a credit limit to the card which is assigned to you. Now, the credit limit given does not necessarily mean that use the whole of it. Practice shows that people who used a maximum 35% to 40% of their credit limit of the credit card, helped them keeping the score batter and on an average increasing the score. The logic is that it shows that the user is not credited hungry and is responsible enough to use some amount of the credit available. In such a case, if your utilization is high, try and get one more card and manage the balance or you can always clear the outstanding and revive the credit limit.

Secured Loans:

Secured loans or secured credits gives the financial institutes an idea that there always is a backup just in case if there is an emergency and you may just not be able to pay off the loan. A Car loan, Gold loan are some such small amount example of loans and secured credit card which is obtained against the FD that is kept to get that credit card are some of few hacks and tricks you can follow to get a better score.

Investing in something and from the interest received, pay the EMIs:

Now, this is one very interesting concept. Say you have X amount of money with you. If you are buying a home or a car or want to go for higher education or maybe send your kids for the education if you are that age, keep that amount as an investment. Take a loan for the work and manage in such a way that from the interest received from that investments, you can pay the EMI of a loan. In such manner, you can have the money safe, invested and with a new loan account, all the factors of the credit score are also covered helping you increase the score!

Follow these simple interesting hacks related to credit score which you probably didn’t know!

How to become your own credit score guru?

Let us decode today all basic details about credit score. First, we start with the main question, Why is the score required? And then. How the score is derived? What are the criteria that affect the score? What is the range of credit score? Which score is considered a good score and which is a bad score? What does the score affect? Eventually, let us take each question and become our own guru when it comes to credit score. First of all, understand that credit score is no rocket science. It is a basic concept if understood properly, you may never go wrong and get a drop in your score!

Let’s start with the first question:

Why is the score required?

Credit Score shows the worthiness of an individual. When one applies for a credit either in the form of a loan or the credit card, the banks or the NBFCs (Non Banking Financial Institutions) checks the score and then decides first to approve or reject the application and then if loan then at what rate should it be approved and if credit card then the credit limit.

What is the range of credit score?

A credit score is a three-digit number ranging from 300 to 900. 300 is the least of score and 900 is maximum.

Which score is considered a good score and which is a bad score?

A score that falls between 300-600 is considered a bad score. A score that ranges between 600-750 is considered as an average score and the score above 750 upto 900 is a good score.

How is the score derived?

There are four different credit bureaus in India who gives the credit score to each individual. They are CIBIL (Credit Information Bureau India Limited), Experian, Equifax and CRIF Highmark. These bureaus have five different criteria for evaluating an individual’s score. These five factors are Payment History, Amount Owed, Credit Mix, Length of Credit History and New Accounts. Majorly the algorithm that evaluates the score has the weightage across all these parameters which is decided by the bureaus!

What are the criteria that affect the credit score?

1. Payment History

Payment History constitutes the major weightage in a score. 35% of the total score comprises of payment History. This is not just the details of the payments that are done but also the detailed description of how the account of any loan say personal loan, education loan, business loan, home loan or car loan and the credit card repayments are done. The delays, dates that are missed or any credit account that is not closed is all mentioned here and affects the score.

2. Amount Owed

Surprisingly, the total amount owed by an individual carries 30% of the weightage in a score. This usually is the current outstanding of the loans and credit cards limits that says the total amount owed by anyone.

3. Credit Mix

This one has 15% of importance. The credit that is taken is divided into 4 categories. Fixed type of credit, Revolving type of credit and Secured type of credit and unsecured type of credit. As the name suggests, these are the basic ones that give you the idea about what exactly they are. A good mix of all these types of credit also makes a good part of the score.

4. Length Of Credit History

How long has been the first ever credit account opened and if it’s still on consists of 10% of the credit score. One must try and not close the oldest credit account in such case for keeping the score better.

5. New Credit Account

Each new credit account opened consists of the last 10% of the score. This doesn’t mean that anyone keeps on opening the account and the score will increase. That would seem the Credit hungry behavior and may drop the scores down. Maximum a new credit account should be opened once in 6 months!

If all these points are taken care for, you can be your own credit score guru and need not be worried about how it works and take advises from various people!

Start learning the basics of your credit score

There is always a first time for everything. That can be your first home, your first car and many more. You tend to have the same feeling about your first salary or application of a fresh new loan. But have ever thought about where does your financial transaction lead you to? All your financial transactions lead you to your credit report.

Now what is a credit report and how does that matter you may ask?

A credit score is nothing but a numeric representation of how you are doing financially. The score ranges from 300-900 and higher the numbers, higher are your chances to get a loan or a financial product. A good cibil score can not only help you get a quick loan but will also help you in many other ways like landing you in your dream job, etc.

It is really important to know the cibil score and also the basics of how the score calculation works. If this is your first time encountering such a thing, you are the right place. Today we will sight you some basics of cibil score and how it is calculated.

Do I have a credit score?

Yes! We all have a credit report. If you are making any financial transaction, you will have a credit score in place. If you have never applied for any credit, your cibil score may be on the lower side or even no cibil score, but you definitely have a report in place.

Checking your own credit score does not affect the score

This is the top most myth which revolves around the credit score and its calculations. There are two types of inquiries, hard and soft. A hard inquiry is made whenever you are applying for a loan or a credit card by the bank and it gets reflected towards the report. On the other hand, if you are personally inquiring about your report, it is termed as a soft inquiry which is not reflected on the account and does not take your credit score down.

How is the score calculated?

The cibil score is calculated on many grounds. Grounds like your payment history, tenure of the credit, types of credit you hold, credit inquiries, etc. What you need to understand is that cibil score calculations are always tricky. Even if you miss one payment, you will end up losing a lot of number out of the score and end up on the low cibil score section. You will have to be smart and agile when it comes to maintaining your cibil report.

 

 

 

Where is my credit information stored?

Your credit information is gathered and recorded to different credit bureaus in the market. The most preferred by the Indian lenders is CIBIL as a credit bureau and most of the time your cibil report is checked if you have applied for a loan.

Can anyone have access to my report?

The answer to this is a yes and also a no. The banks and lenders have special access to view report of any individual who is applying for a credit or a home loan so yes; the creditors have access to your report all the time. On the other hand, on a personal level only you have access to your credit report and no one else.

Is data theft real?

Yes, it is. Your data if not preserved properly can be used by someone else and you may end up having a low credit score. Always make sure all your information is accurate and safe so that you do not encounter such a thing.

When you are starting fresh on the credit grounds these are the basics you should know, what is much more important than the above points is, how you maintain your score for future financial transactions.

Maintaining a good Credit Score is a matter of patience

Recently, you may have applied for a loan or a credit card and seen your application getting rejected again and again. You must be given the reason frequently that you are denied a loan or a credit because of you low cibil score. In such situations what would you do? You do the obvious! You get your free cibil score, Start researching on how you will get your credit score up in no time and get your credits approved. It seems simple, right? No, it is not that easy, once you end up in the loan defaulter list, it is really a struggle to get your cibil score up any time soon.

You explained this situation to someone in your office and asked for their suggestion. Your colleague had no clear answer for you which you can bank on and start amending your credit score from negative to positive. Your research continues and you run out ways to get your score up in quick time and now you are in a situation where you need a loan, but you are getting it denied due to the reason being, you low cibil score.

There is no shortcut for you when it comes to appreciating the credit score. It is a slow and gradual process. Once you default a payment, you see a sudden dip on the score, but on the other hand, you will have to make regular payments before you see your score to be stable and growing. Do not mistake that the defaults will vanish from your credit report. Every financial transaction you make is recorded on the report and it stays on the report for a very long time.

There are some tips and tricks which can help you get started,

Make all payments on time

This is the first and foremost thing which you need to do when it comes to amending your score. You will have to make all your payments on time so that you do not default your loan as well as see a dip on your score. If you make all your payments on time, the score remains steady and constant.

Stop making credit inquiries

When you know that you lie in the lower side of the credit, stop applying for loans and credit cards again and again. This will hamper your score even more. A credit inquiry is one of the components which decide on your cibil score. The more inquiries you make, the more your chances are to get a dip the score.

Keep an eye on your credit report

There are high chances that your credit report may contain a mistake made by the credit bureaus. This is a frequent drill where the bureaus make mistakes on the report. What you need to do is check your report frequently and report any mistakes to the credit bureaus if found. The dispute will take up a lot of time, but will help you get a healthy resolution and get your score up in no time.

Don’t exceed your credit limit

Your credit limit is an important thing and you do not realize that until you have completely exhausted it. Minimum usage of credit limits shows that you are responsible spender and do not spend on unwanted luxury. Less usage of limits mean, less to pay back and less pay back will lead to a healthy credit score.

Building up your credit is indeed a slow and gradual process, but what is important is that you need to be careful with your payment patterns to avoid such mishaps.