cibil score

Maintaining a decent CIBIL score necessitates disciplined credit management. Though your credit score will not increase overnight, there are several things you can do to boost it. It can take anything from 6 months to a year to improve your credit score.

How to Improve your CIBIL Score

Here are some of the ways through which you can increase your CIBIL score:

Pay Your Loan EMIs and Credit Card Bills on Time: If you want to keep your credit score in good shape, make sure you pay your loan EMIs and credit card bills on time. Regular EMIs demonstrate responsibility to the bank and help you improve your CIBIL score.

Mix of Loan Types: Having a solid balance of secured and unsecured loans can help you improve your credit score. Taking out only unsecured loans may give the impression that you are a high-risk borrower.

Maintain a low debt-to-income ratio: While loan repayments can lessen the amount due over time, it’s also a good idea to avoid exceeding your credit card limit too often, as this will reflect adversely on your creditworthiness.

Avoid Multiple Credit Applications: Applying for multiple credit cards at the same time may seem enticing since they provide a rapid source of cash, but managing too many credit cards can be challenging at times, and missing even a single EMI will hurt your credit score.

Maintaining Old Accounts: Having an old debt on your credit report and paying its EMIs on a regular basis reflects your dependability and can help you improve your credit score.

These are some of the ways on how to improve your CIBIL score. Using these methods can help you improve your credit score.

Benefits of a Good CIBIL Score

Now that you know how to increase your CIBIL score, here are some of the advantages of having a high CIBIL score.

Interest rates are low, and credit card fees are low: You will almost always be able to acquire the best interest rates and pay reduced finance expenses on credit card balances and loans if your credit score is strong. If you pay less interest on your debt, you will be able to pay it off faster.

Approval of credit cards and loans is comparatively easy: Your chances of getting credit rise when you have a high credit score. In general, you can apply for a loan or a credit card without worrying about getting turned down. This is because banks consider you creditworthy for a loan if you have a high CIBIL score, thus your loan or credit card application is more likely to be approved.

Increases your bargaining power: If you have an excellent credit score, you can negotiate lower interest rates on credit cards and loans. However, if your CIBIL score is low, the bank will charge you a high interest rate on your loan application. You won’t be able to further negotiate conditions with the bank if your CIBIL score is poor.

Easy Loan Top-up: You can quickly apply for a top-up and increase the loan amount on an existing loan since banks will examine your credit score and consider it to easily add some money to the existing loan amount.

These are some of the benefits that come along with a good CIBIL score. Therefore, it is important to regularly check your credit reports to avoid any unwanted errors that can lower your CIBIL score. However, it is not necessary to know how to increase cibil score, it will stay. If you delay or default on any of your loan repayments, your CIBIL score will take a hit and it can fall.


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