Everything you need to know about CIBIL!

Credit scores are a number that represents your creditworthiness. Lenders use credit scores to determine whether you are likely to repay a loan and help them decide whether to lend you money.

 A credit score is generally based on information about you sourced from your credit report bearing on your credit history. It is primarily based on information in your credit report, which is generated by the credit bureaus and typically updated once per month.

What Is a Good Credit Score In India?

CIBIL scores can range anywhere from 300-900 in India. Generally, most credit scores lie between 600 and 750. Now if your credit score is above 700 then it is awesome.

As we have mentioned the basics of CIBIL score, let’s put light on how you can improve your score and fetch more money.

Here Are The Ways To Increase Credit Score Faster…

Pay Credit Card Balances Tactically;

 A good guideline is to use less than 30% of your limit on any card, and lower is better. (The highest scorers use less than 7 %.)

Your credit utilization is the number of credit limits at any given time.

 Monitor your credit utilization ratio by paying off your balance before the billing cycle ends, or by making multiple monthly payments.

Ask For Higher Limits To Improve Quickly;

  If you’ve been carrying a balance on your credit card and are close to maxing out, ask for a higher limit.

If you want to improve your credit score, one of the simplest things you can do is ask for a higher credit limit on one or more of your credit cards. When you do this, it will usually lower your “credit utilization rate”, and could even boost your credit score.

You Should Use A Secured Credit Card;

If you need to restore your credit, use a secured credit card. This type of card is backed by a cash deposit, so you’re never at risk of overspending.

With a deposit as collateral, these cards allow you to build or rebuild your credit while still having access to overdraft protection and a debit feature—all from one card. Plus, most offer rewards that can go toward paying down your balance without interest.

If you make payments on time, your credit will improve over time.

No Matter What, Always Pay Bills On Time;

It’s easy to forget about a missed payment or two, but your credit score will be dinged for years if you miss one by 30 days or more.

If you miss one by 30 days or more, call your creditor immediately and ask if they’ll remove the missed payment from your credit report. Even if they can’t do that, it’s still worth making sure you’re current on the account ASAP. Every month a history that goes delinquent hurts your score.

Even if they can’t do that, it’s still worth making sure you’re current on the account ASAP. Every month an account that goes delinquent hurts your score.

Now here is a last piece of information for you…

The average debt-to-income ratio of scores that are at 699 or below indicates a high likelihood of defaulting on income-driven repayment plans.

So next time look for the different credit options before taking a loan which offers you better standing on CIBIIL.