Now that you know what a good and high CIBIL score can get for you, you must be wondering how you can improve your CIBIL score. If you have a low score, below are some measures that can help you improve your CIBIL score:
1. Check your credit report regularly.
You must have a habit of checking your credit or CIBIL reports regularly. A CIBIL report will help you identify the factors which have brought down your CIBIL score. These factors usually include unpaid or delayed loans. This identification makes you evaluate your personal CIBIL report and helps you spot errors in it. In case you need to correct information, you can contact the mentioned bank or financial institution and get that error rectified.
2. Clear credit card balances.
Another thing to improvise a CIBIL score is to clear out the balance in your credit cards. Balances also include unpaid dues on loans and EMIs, which can bring the CIBIL score down. Contact the lenders/banks and pay off any outstanding dues. This way, one can improve their CIBIL score.
3. Clear out inaccuracies in the CIBIL report.
It is important to keep reviewing your CIBIL report from time to time in order to keep a check on the information that is being put on there. In case you see any inaccurate detail, it is important to get it rectified immediately, so as to avoid getting your CIBIL score hampered.
4. Keep a check on your credit utilization ratio.
Avoid using your credit cards for every transaction you make. It is important to keep your credit card utilization ratio below 30%, as keeping your monthly balances low can reflect a healthy CIBIL score.
5. Increase your credit card limit.
You can ask your banks to increase your credit limit, usually for credit cards, to have more credit available for your use. This does not mean having to spend it all beyond your capacity. Having a high credit card limit and a low credit utilization ratio can be reflective of a responsible borrowing behavior and can thus lead to a positive CIBIL score.
6. Keep a check on joint credit terms.
If you are the joint application for a loan that has been taken by someone else, you should keep a regular check on the repayment of that loan. In case they have missed on payments, then you will also end up lowering your CIBIL or credit score, as this will reflect in your report as well. The best way to avoid this is to ensure that the loans and cards are being paid off on time. It is usually advised that one should limit themselves from applying for joint credit terms.
The CIBIL score is a value that should always be high, and the CIBIL report is like a report card that is a reflection of your past performance and behavior as a borrower. It is the parameter that establishes trust between you and your lender by ensuring that you will repay their lent money on time.
Getting a loan in today's times is like a boon as it enables you to get a step closer to monetary happiness. But, getting a loan approved in the current times can be difficult if you don't have a good credit history. The CIBIL score puts a numeric value to your credit behavior and is reflective of your trustworthiness. Thus, it is important to improve your CIBIL score in case it is low and retain its value, in case it is high.
Some basic measures and simple responsibilities can help you put on a healthy image in front of the market and get you closer to getting what you desire; be it a car you want, a house you wish for, wanting to study abroad, or a business you want to start.
