Tag: increase credit score

3 Things You Can Do Once Your Credit Scores Are Up!

Its a real big task when it comes in improving your credit score and maintaing it once u achieve the benchmark. If the score is built nicely from very start, and maintained the same repayment schedules, it not possible only that one can not get the graphs up. It that case, one need not worry about anything.

But, if one is not responsible in the repayments, has been constantly irregular, the scores go on toss. It is then very difficult to get you graph up. However, it is difficult and not impossible. Once you have Low CIBIL Score, it is then your task to first investigate where you went wrong. Look into your detailed repoert and see where all have you made mistakes. Start from correcting the places where you have made mistakes. IF it looks difficult to understand, take help of some credit advisors. Speak with the banks. Make them understand what went wrong while your intention was to pay for the credits you had taken.

Start using your credit card wisely. Use as much as you can pay. Start repaying in small amounts. And clear the old debts. By this you will start replenishing the old debts. And start rebuilding the score. Its important to Improve CIBIL Score. Once your score is up, you can then plan things for which you planned but could not do. Lets look at main 3 things one can do once the credit score is up!

  1. Apply for a loan at lower interest rate.

While you were planning to apply for a home loan or a personal loan when your score was down, the banks or the NBFC must have charged you an expensive interest amount which would have surprised you! Once your scored are up, try applying for the same loan from the same bank and you would come to know that there us a huge difference between the interest amount then and interest amount now. Once the credit scores are up, it is a sign that you a responsible payer and would not be an liability for the financial institutions. And hence you get lower interest rate compared to earlier one.

  1. Get your loans sanctioned in no time

While your scores were low, you had to run and climb staircase of all the banks, you went, inquired but in the end what you had was just disappointment. You came back home everyday with sad face as no one was ready to sanction a loan for you. But as soon as you scores are up, you need not worry at all. Now as and when you will apply for loan, because your scores are up, you loans will will be sanctioned easily.

  1. Upgrade your credit card limit

Remember, while you wanted to get your credit card limit up, but were unable to it. Why? Because of credit score. Credit score determined your eligibility for many things. Specially it determines the credit worthiness. Hoe much credit worthy you are. What is credit worthiness? Credit worthiness is a phenomena which gives an idea about how much credit can you manage without any burden. So when your score is up now and you apply for a upgrade in the credit card limit, it will be approved in minutes.

When you try to improve CIBIL score, and you are successful, there will be many things which would be approved or sanctioned which you wanted to earlier and could not but now with a better score, it will no hurdle. Credit Score is a sensitive area, you need to work it very diligently in order to make things on perfect way. Stay credit healthy and keep you score good!

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Is It Possible To Raise The Score By 50 Points In A Month?

Credit score is a statistical reflection of credit behavior over the years and credit history starts from the first loan or card you had till the current times. So one action does not make or break the score but each action related to debt does contribute to the ultimate score, some contributing more than others. So paying regularly or missing payments is more important than loan enquiries as repayment history contributes 35% to the score calculation. If you have multiple loans running concurrently then the importance of each EMI would be less than what it would be if there was only a single loan running. It is also important to remember recent events are more important than the older ones.

So whether it is possible or not to improve your score by 50 points will depend on a host of factors specific to a person’s credit report and various inclusions in it.

Ways to Improve Credit Score in a Month:

Before figuring out the best way to improve CIBIL score it is important to get your CIBIL report and go through it in detail and understand what the improvement areas are. The two quickest ways to improve your credit score are; removing any old dues and disputing any errors.

When going through your credit report you may realize that the score is low not because of something you did but due to an error caused by somebody else. So there might be times when the cause of a low score might be inaccurate reporting by a lender of a missed payment or including a loan in your report that does not belong to you. Sometimes these errors can happen at the level of the credit rating agency too. Thus as soon as you spot the error you need to get in touch with the rating agency and follow the dispute resolution process laid down by them. It takes usually a month to get any dispute resolved and getting the erroneous item removed from the report could boost your score immediately.

Another quick way to improve the score is to settle old issues that may be there in your report. Unpaid dues on a credit card that have been piling up, a loan that has been paid in full but the NOC has not been taken, a disputed loan on your report are sure to cause it to fall down. Getting the NOC or paying of a disputed amount are quick ways for a bad credit fix. When paying old dues ensure that the account is reported as “paid” and not settled. However once you do that make sure to get your credit report after that to see if the same has been updated in the report.

A Few More Ways That Can Help:

While the two ways mentioned above can help you up your score quickly there are a few other ways also that can come to your rescue, maybe not so quickly but they will definitely have a positive impact on the credit score over time:

  • Keep the credit utilization under 35%. After repayment history this is the most important factor that influences credit score calculation. So keeping the credit card spending less than 35% of the sanctioned card/s limit can help to a great extent.
  • You could get your credit limit enhanced if you are eligible for it and your credit card spending is more than 35% of the sanctioned limit but you do manage to pay on time.
  • Avoid making any loan inquiries when you are trying to improve your score in a hurry.
  • Also do continue to pay all your dues on time and do not miss any payments, as repayment history is very important for any credit score.

So to sum it up it may be possible to increase you score by 50 points in a month depending on various factors, however it is always best to remember that credit rating is a long term process and one must follow the basic guidelines to remain credit healthy.

Credit Repair Do’s and Don’ts

A credit score is an important financial measure that determines your ability to borrow money. Missed EMI payments, delays in paying credit card bills, over utilization of credit are some reasons that may cause a fall in the score. If you have a low CIBIL score, and are looking for ways to get your life back on track, you are at the right place. Here we will give a complete guide to what you should do and what you shouldn’t do if you want to fast track your journey to improve CIBIL score.

Do’s

Review your credit report- Check your CIBIL report to identify the reasons of a low score. A careful review will help you assess your credit behaviour. It will serve as an eye opener as to how small things like a delayed payment can have a drastic impact on your credit score. Also look for negative entries on your report that you may not recognize. If you spot any inaccurate information report it immediately as you may be a vicitim of identity theft. Disputing and getting errors corrected will help to increase credit score.

Pay your bills on time- The simplest way in which you can contribute to increase credit score is to ensure timely payment of EMIs and credit card bills. Payment history makes up 35% of your score. Even a single missed or delayed payment can bring down your score drastically. Sign up for payment reminders through email or phone or set up automatic payments to avoid missing payments. If you are already behind on your payments then create a plan to pay back your debts systematically. Keep a check on your spending habits. Trim down your expenses. Talk to your lenders to work out a mutually convenient way of paying down the balance. Take care of accounts that are more than 90 days late. If your account ends up in collections it will be very damaging to your score.

 

  1. Pay the card balance in full- Credit card balances attract a very high rate of interest. It is best to pay the card balance in full each month. People who pay only the minimum amount due, usually end up falling into a debt trap.

 

  1. Keep utilization levels low- Keep your utilization levels to below 30% of available credit limit. It works well to improve CIBIL score. You can set up alerts that notify you when you reach a certain limit.

Don’ts

 

 

  1. Do not close your old credit cards- The length of the credit history or the average age of accounts affects the credit score of an individual. Keeping old cards active contributes to this factor positively. Moreover if you close your credit cards, your total available credit limit on all your cards decreases, thereby increasing your overall utilization ratio. For example if you have 2 cards each with a credit limit of 50,000/- and a card balance of Rs 25,000/- (on 1 card) then your utilization will be 25,000/1,00,000 i.e. 25%. Closing one card will reduce your total available credit limit by 50,000/- Your new utilization level will jump to 25,000/50,000 i.e. 50% thereby causing a hit to your score. Hence if you wish to increase credit score never close your old credit card accounts. Use the card for small purchases and pay off the balance at the end of the month to keep the card active.

 

  1. Do not apply for multiple credit cards in a short span of time- Each time you submit an application for a credit card, a credit enquiry hits your credit report. Multiple hard enquiries in a short span of time display a credit hungry behaviour. This will decrease your credit score.

 

  1. Do not expect a change too soon- There is no quick fix to improve CIBIL score. A strong positive history develops over a period of time with consistent and responsible behaviour. It needs a lot of hard work, patience and dedication to improve your credit position before you can see some positive changes in your score.

 

It isn’t as hard as it may seem in the beginning. Knowledge of the factors that contribute to your credit score, a systematic plan to work on those factors and dedication to bring about change is what it takes to repair your credit.