Raise your credit score, raise your life
Credit score has lately become a household term with the young urban population becoming increasingly aware of their CIBIL. With ease of payments and facilities such as part payment system and EMIs, people are waking up to an improved standard of living due to easy finance
To obtain easy finance at low interest rates, one requires a good credit score; one that is established through good credit history and repayment practices.
A bad credit score range can become a pain point for future borrowing. Though most people in India are aware of the financial aids available to them but most still remain unaware of the benefits that accompany a good credit score in India.
What is a good Credit Score in India?
There are four agencies in India maintaining a record of an individual’s credit rating. However, CIBIL is one of the most popular and foremost agencies maintaining an individual’s credit report. The credit score in India is a three-digit numeric representation of an individual’s credit history and credit rating. The score ranges from 300 to 900, with 900 being consider as good credit score and the bad credit score ranges from 300 to 699. A good credit score ranges between 700 to 900.Individuals with no credit history usually possess a score of -1.
What affects a good credit score?
Four major factors can affect a good credit history for the bearer:
- Payment History – Delayed and/or no-payment is an instant hit on the credit ratings. The lapses are indicated immediately on an individual’s credit profile resulting in a bad credit score.
- High Utilization of Credit Limit – High utility of your credit card indicates a high need for money thus impacting an individual’s capacity to pay, and lowers your credit score.
- Higher Percentage of Unsecured Loans – A balance between unsecured and secured loans make you a more viable choice for lenders. The secret to maintaining a good credit score in India is to develop trust with on time payments.
- Many Accounts Opened Recently – An inclusion of multiple loans and credit cards will inflict on your credit report; as additional credit burdens can keep you from making your payments on time.
How to get a Good Credit Score?
Some key practices can help you raise your credit score:
- Timely Payments – Delayed payments directly impact a good credit score. So be sure to be regular.
- Keep your Balance Low – Control in spending is your main leverage point.
- Healthy Mix of Credit – Let your credit report be a garland of secured and unsecured loans.
- Credit Line Moderation – Don’t let your credit report portray you to be a credit hungry person.
- Monitor your Co-signed and Joint Account Parties – It is essential to keep a tab of the expenses being made on a joint account to keep a healthy score for both the parties involved.
- Review your Credit History Regularly – Ensure to check on your credit history several times in a year to be sure of your credit score. Balance your actions and educate yourself and your co-signers on how to raise credit score.