The Bad Credit Score Survival Advice

A red flag in the credit information report is like a fire in the jungle. You do not know how much damage it would make until it eases off. Surviving bad score is thus not easy. A lot of people might share the tricks of restoring credit score however the truth is, it is easier said than done.

Once ruined it would at least take six months to rebound the low CIBIL score. Many a times the damage stays on your report for years to come. All you can do is pacify the bad history with good history.

Let’s find out how you can cope with bad score and roll over the financial dice in your favor once again.

Seek professional advice on bad credit score survival.
After you come to know about your low score, the first step should be to seek a professional help. When you contact a Credit Improvement Agency, it would assess your credit report and guide accordingly the ways to improve the score.

If however you choose to do it yourself, go for free CIBIL check online and study your report. It will help you understand the gravity of the problem. After studying the report, if you find any errors eliminate them without a delay.

Make a budget and organize your finances
With bad score, your credit worthiness is hurt very badly. You need to take charge of financial conditional and analyze your expenses and incomes. Calculate your net income and know how much you actually have in hands to pay out the debts and installments. You should try to close the expensive cards and accounts first and try to save as much as possible.

Not to mention, you should try to add as much income avenues as possible and try to have some surplus every month. Your sole aim should be to become take your debt utilization ratio to 30% of the limit being granted to you.

Contact your creditors and make a repayment plan
When you have too many debts to manage, you should consider contacting your creditors in a hope to find an option to survive the bad account. Speaking with your lenders may help you find a middle path with lowered interest rate or a new repayment plan.

Raise additional loans to pay off loans / credit cards
After you limit the pressure of debts by closing expensive cards and refinancing of the loans, consider applying for new secured loan to survive the bad credit. You can use the amount to manage your finances and repay diligently all the installments. This would build a good history and gradually improve the score.

Use a co-signor or guarantor to avail low interest loan
When you have bad credit score with red flags in the credit report, it is unlikely that banks would offer you loans at low rate. With bad score you become a risky prospect for the bank and they want to lend only with a certain degree of security. Besides rejection of a loan application further ruins the score. Keeping both the facts in view, you should apply for loans with a co-signor or guarantor.

You can ask your friend, spouse or blood relative with high credit score to become a co applicant or guarantor for you. This would raise the chances of loan approval and that too at normal interest rate.

Use a high worth asset as collateral
With bad CIBIL score each unplanned financial activity would hurt your score further. Besides loan repayment and credit utilization ratio, the mix of loans and length of loans also affect your score. If you have home equity or other high value assets such as Gold, you can use these assets as collateral and raise a secured loan.

Consolidate your debt
When you have too many debts to pay and manage every month, you can consider consolidating them into a big umbrella loan that helps you close all accounts into one. You can consolidate loans as a long term personal loan using your home as collateral. The goal of consolidating loans is to make your monthly repayment affordable and save some surplus every month.

Rent a home/property
Last but not the least you can consider renting your home or part of your home to raise some extra funds and save some amount every month.

Using all these steps you can gradually improve your credit health.

I need a free credit report. What should I be doing

A credit report contains details about your credit history – loans, bankruptcies, credit accounts etc. The information in the report is used to generate your credit score, which is a three-digit numeric summary of your creditworthiness. Financial institutions will look at your credit report and credit score while making lending decisions. If you would like to view your CIBIL report, you would have to visit CIBIL’s official website and fill in their request form. The bureau will make available the report at a certain cost. It is important that you check your report at least two times a year to know where your creditworthiness lies. If you ever get the option to check free credit score from a legitimate source then do not let go of it.

 

At present, India’s credit bureau does not give out CIBIL reports for free. If you want to avail the report right this moment, you would have to pay a certain sum to avail it. However, recent news articles have suggested that the credit bureau is likely to begin providing individuals with one free credit report per year. The bureau is expected to begin doing so from January 1, 2017, news reports suggest. The central bank has said that the report must be provided on request, any time during the calendar year. Access to the free reports, which will be in the electronic format, is expected to raise consumer awareness and help people make more meaningful financial decisions. Now when you do avail a free CIBIL report, it is important that you treat it as a credit health management exercise. Many make the mistake of limiting themselves to checking on their report only before sending out a loan application. It is very essential that one regularly checks on his or her credit health so as to know where they stand financially.

 

If you want to check free credit score, visit the online website of Freescoreindia. Freescoreindia has joined hands with Credit Sudhaar to provide free credit scores in the country. In order to check free credit score from the website, you would be required to enter some basic information such as your name, email address, city and phone number. Once you have submitted all the necessary details and documents, your credit score will get updated to your online account in a span of 72 hours. You will also receive notification via SMS and email concerning the same. Finally, login to check free credit score.

 

It is prudent that you check your CIBIL report at least two times a year. Checking your report is the best way to know what needs improvement. If you plan on sending out a loan application, it would be a good idea to look at your report at least six months prior so as to make sure that no discrepancies have crept in. Regularly checking on your report will also help you realize whether or not you have fallen victim to identity theft. This is crucial given the rising cases of people falling victim to identity thefts. Additionally, staying updated about what your credit history looks like will help you set your financial goals.

 

Banks and other financial institutions will look at the contents of your CIBIL report to assess whether or not you are eligible for their loans. They will also determine the interest rates to charge you based on the conclusion they draw of you from your CIBIL report. If your score is low, chances are that lending institutions will charge high interest rates. Sometimes even employers will look at a candidate’s credit report to help them in their hiring decision. Landlords could also review your report when determining whether or not to rent to you. It is thus very important to keep track of the contents in your report and ensure that there are no errors of any sort. If you would like to check free credit score, we suggest you go through the website of Freescoreindia. If you come across other websites that will let you check your score or report for free, make sure it is authentic before taking things forward. Do not share yours personal details unless you are 100% certain that the website is authentic.

 

Can You Get A Credit Score From Your Bank?

Credit management is a big responsibility. The way you handle your EMIs and credit cards can directly affect your loan approval prospects in future. To ensure you are on the right track it is important that you keep a check on your credit score on a timely basis.

There are various ways you can get a credit score such as-

  • Your Bank- Some banks and even loaning companies do provide CIBIL score to their customers on a monthly basis. You can either check your score by logging in your account on their website or they may provide you the same on your monthly statements.
  • Credit Score Service Providers- Owing to the significance of credit score today many websites have emerged on the web that provide free CIBIL check online While some of these websites only provide you a rough estimate of your exact score by analyzing your credit history and payment patterns some of them do actually provide the exact score.
  • The Authority- There are different credit bureaus in India that can be approached for your credit score. These are CRIF High Mark Credit Information Services Pvt. Ltd. , Experian Credit Information Co. of India Pvt. Ltd, Equifax Credit Information Services Pvt. Ltd, and Credit Information Bureau India Limited. Out of these four 4 CIBIL is the most widely accepted one. Majority of banks are associated with CIBIL only and so if you want your credit report you can fill out a form on CIBIL website and pay a nominal fee. You will receive your detailed report along with the score.

There are many things that can hurt your credit score and inquires made on the same is one of them. Basically there are two types of inquiries- soft enquiry and hard enquiry. While the former doesn’t affect your credit score in any way the latter does so slightly.

Soft Enquiry- A soft enquiry is the one that is made by you. For instance, if you just want to check your score then you can get your report from CIBIL. This will be a type of soft enquiry. You can get your report any number of times you want but your score will never be affected.

Hard Enquiry- Hard enquiries are made by your lenders or banks when they have to make a lending decision. For instance, when you need a credit card then your bank will first make an enquiry to CIBIL to see if you have a decent CIBIL score. Only if they are satisfied with your report and score you will get your credit card. The problem with hard enquiry is that if your loan or credit card applications are rejected multiple times then your score will be damaged even though you are not obtaining what you seek(credit card or loan). Thus, credit management experts always recommend that you only apply for loans when you have a good score first.

Enquiries on your credit score should always be made with caution. Too many hard enquiries on your report could cause a lot of damage and make things even worse. If your bank doesn’t provide credit score to its customers it is best that you get your copy of report from CIBIL itself. You can also look for websites that offer the same. Just make sure that they don’t make a hard enquiry as that would be counter-productive.

How to Avoid Hard Enquiries?

If you are going to apply for a loan or a credit card you can’t dodge a hard enquiry. However, you can minimize the damage by apply for loans around the same time. For instance, if you are comparing different loans available in the market then it is better if you apply for them simultaneously. Chances are that CIBIL will recognize the pattern and understand that you are only trying to get the best deal possible. This should minimize the damage to your score. However, if possible you should apply for loans only when you feel your score is high enough to get an approval.