Tag: Loan

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!


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 card is a 2-way sward

Instant access to cash and credit is the best boon one can get. But we have a balance in this universe. As the boon exists, even the curse exists. It is us who have to be responsible enough to not change the boon to curse. With credit cards so easily available, it has become easy to shop and utilize it to get things which otherwise we can’t get if we do not have cash. But with this ease of instant access, there should be equal amenability to repay the credit one has got. As the title suggests the credit card, is a two-way sword. It’s not just the facility you have got. But also the responsibility you have to keep towards it. Let’s simplify this by example.

Santosh, a very enthusiast young blood, highly educated and with lot of brains has just entered his professional career. Its been 6 months to what he has started earning, but with a handsome salary package, he is reward with lots of perks. He applied for a credit card as he saw his bank offering him with good offers. What else he wanted. Instant access to whatever he wanted to buy online, or where ever he wanted to travel. All he had to do is go somewhere and swipe his card, and pay a month later and not instantly. Or he had to enter his credit card details if it was online payment. For first few months things were good. He used his credit card. It also helped him build his score and increase cibil score. But as time passed, he started becoming reckless. He made use of his credit card everywhere without making sure if he was equipped to make the payment when the bill came. This happened for 2-3 months. He kept on paying only the minimum amount and the access was carried forward for next bill. This added the major percentage of interest rates. Now the time came when he planned to take an auto loan.

So, he went to a bank and inquired about the loan and other formalities. But, the first bank denied. When this happened to 3-4 banks, he went to dig through with-in, then he came to know that he had screwed his credit score, and that was the reason behind his rejection of loans.

We need to understand this logic, you can’t be “penny wise pound foolish”. Once the credit score is goofed up, it takes a long time to repair it. Bad credit fix needs lot of patience and work. The score might just get ruined in 3-4 months, but to take it up, it minimum takes 7 months or more. When you approach the bank for loan, they check the score. It shows the behavioural pattern, you have borrowed the money which is not yours, so you are ought to repay. When it comes to credit card, it’s a revolving type of credit which is unsecured. So the credit score is affected big time. If worked wisely, it is the best method to boost your score either to build it or increase it.

Credit cards obviously give you the instant access of cash in the needy times. When you are stuck somewhere and do not have cash in hand, there is the requirement to pay,  credit is a boon and acts miracles. But, with this easy power, you have the responsibility. So, don’t be fool enough to not work just one side and take the advantage, but also stay sensible for the payments.

Its a simple logic, best things in the world are for free. And the power-responsibility goes hand in hand. When it comes to credit or credit card, it is a 2-way sward. With just the ease to walk smooth, the flip side is dangerous. Be patient and work diligently to deliver the best!