Your financial payment history is very important. This is most important in getting your loan approved or rejected. If you have a bad CIBIL score then you will not get the loan. If the CIBIL score is very good then the loan is easily available. If the loan is not very good then you may have to take a loan at an expensive interest rate. If your CIBIL is very bad then it is not that it cannot be improved. If some special measures are taken to improve it then it can become wonderful again. CIBIL score or credit score of any category can be improved. If you understand the factors affecting your credit score and take measures to improve it, then the path ahead can be easier for you.
Know the CIBIL score range first
CIBIL score ranges between 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.
CIBIL score can be improved in this way
Be disciplined with credit
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 reduces your credit score. So if you feel that this is something that you are guilty of doing, then make sure to set reminders for EMI payments so that you can settle them on time.
Keep old credit cards
According to Bajaj Finserv, if you have old credit cards, you should retain 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
If you take a loan, choose a long term
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 pay on time. Your credit score will improve when you do not miss, delay or default in paying the monthly installment.
Do not take too much loan at one time
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 shows 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. If you take a loan and repay it successfully, your credit score will increase further.
Check and correct mistakes in CIBIL report
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