It takes effort to build a good credit score. A high credit score comes with the benefit of quicker and better loans. However, a loan on low credit score is quite challenging for individuals in need of urgent money, as this might adversely affect their borrowing. There are several methods to get loans, the criteria of which entirely depend on the loan size, which is the amount needed by the borrower. However, at present, all banks and loan applications have made it mandatory to verify the credit score of applicants for each financial product of credit cards, credit and personal loans.
Even though many individuals have a low credit score, there are always ways to enhance it.
How To Boost Cibil Score With Present Loans?
There are many smart moves through which you can build a good credit score and get an instant loan online. But remember to practice these strategies regularly and keep an eye on your loans and credit card monthly payments.
Credit Information Bureau India Limited (CIBIL) is a renowned credit rating agency in India. Financial institutions and lending platforms depend on cibil scores to check the creditworthiness of borrowers. An individual having a score of 700 or more is considered an excellent one; however, a lower score results in difficulties while applying for a loan. Given below are smart strategies for you to swiftly enhance your cibil score:
- Avoid excess debt
Applying for several loans altogether eventually harms your credit score. It is important to utilise credit wisely and also have a limited number of loans at a single time. Make sure to focus on loan repayment before applying for another. The strategy represents responsible borrowing behaviour and also maintains a healthy credit score.
- Timely payment of dues
Paying your credit card bills and EMIs on time is essential to having a good credit score. Missed or delayed payments eventually reduce your score. Make sure to automate your bill payments and set up reminders to never miss a payment deadline. Paying your dues consistently on time has a positive impact on your credit score.
- Apply for needed credits only
Only apply for additional credit via a bank or low interest loan app when needed, and make sure you are capable enough for managing the repayment. More frequent credit applications might result in financial instability and reduce your score. Hence, only apply for credit that you can afford and use your present credit responsibly for an overall good credit score.
- Monitor joint accounts
If you are a guarantor or cosigner on any of the loans, you are equally responsible for the repayment. Any missed or delayed payments by the primary borrower will eventually affect your credit score. Hence, ensure to monitor such accounts regularly and avoid becoming a guarantor or cosigner unless required.
Conclusion:
Building a strong credit history needs time. When applying for loans, prefer a longer loan tenure, if it comes along with lower EMI and also prevent overspending on high credit limits. Additionally, by following the tips given above, you can boost your CIBIL score along with your present loan.