Get Your CIBIL Scores In Shape Today

Grooming your CIBIL score puts you one step closer towards obtaining that home or car you have always desired. How? Your CIBIL score has a direct effect on your ability to get credit.

Banks and other financial institutions will assess your credit health by looking at your credit score and CIBIL report. Undertaking a credit check will help them determine whether or not to take your application further. A good score goes a long way in securing your financial future. It lets you avail loans at favourable terms and conditions in addition to getting it at competitive interest rates. The closer your score is to 900, the easier it becomes to avail loans from financial institutions. Each financial institution has its own minimum credit score that serves as a cut off for accepting or rejecting applications. Most financial institutions in India have been seen to only consider applicants with a score of 750 and above.

As credit institutions in the country are inclining more towards risk-based lending, it is important for each person to implement effective financial discipline. Therefore if a credit check causes lenders to reject your application then it is high time to buckle up and undertake measures to increase credit scores. Let us look at what lenders do not like to see during a credit check.

What scares lenders away?

When financial institutions decide to undertake a credit check, you would want to avoid having anything that appears too risky in your CIBIL report. If they come across anything they don't like, they can easily reject your application. To keep this from happening let us look at some items in your CIBIL report that gives lenders the jitters:

  • Too many credit checks by financial institutions
  • Missed payments
  • Higher ratio of unsecured debt
  • Co-signing another person's debt
  • Now that you know what lenders do not wish to see during a credit check, you must try to avoid these above mentioned factors from appearing on your CIBIL report. These factors will bring down your score in a drastic way. Let us now look at some measures you can do to maintain a healthy CIBIL report and increase credit score.

    Stop your score from declining

    Regularly check your credit score. If your score is declining, then investigate what is affecting the CIBIL report. A bad score can ruin your financial future. In order to build up your score, you would have to invest sufficient time and effort. There are no quick remedies to help increase your score overnight! Here are some things you can do to get your score in shape:

    If you are habituated to late payments then it may be the reason for your CIBIL score to decline. The only way to increase credit score and maintain a healthy CIBIL report in this case is by ensuring on-time payments. Keep yourself updated with the knowledge of your CIBIL score and CIBIL report. In this way, when financial institutions undertake a credit check, they won't be in for any unpleasant surprises. Also check your CIBIL report for errors, if any. Make sure that all the listed details are correct. If you spot any discrepancies then you can raise a dispute with the credit bureau.

    Your spending has to be kept in check, or else it could spin out of control and hurt your score. Effectively using your credit card is another means to increase credit score. Make sure that you do not utilize the card fully to its limit.

    In case you are still struggling with a poor or a bad score you, should reach out to a credit advisory company. They will tell you about all that goes into consideration in a credit check and the different means to increase credit score. Remember, a poor or a bad credit history can cause your loan application to get turned down.

    Author is an financial expert helping people resolve cibil dispute and help them to improve cre effectively.

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