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7 smart tips to improve your CIBIL score immediately

How to Improve Your CIBIL Score Immediately

CIBIL is one of the leading Credit Bureaus of India. Credit bureaus are in charge of generating reports based on an individual’s credit score. CIBIL score reflects a person’s credit history.

Lending institutions use CIBIL scores to evaluate the creditworthiness of loan seekers. It is also used in a wide array of credit-based financial products and for loan approvals.

Many lenders classify their customers according to their credit scores. The rate of interest offered by a lender will depend upon the risk associated with the borrower as well as the lender’s policy.

Scroll down to know 7 simple tips which could help you improve your CIBIL score

1. Pay your bills on time

Make sure that you always pay your dues on time and in full. This includes Credit Card payments, EMIs, etc. To ensure that you have a disciplined approach, a good practice is to set up payment reminders, as well as subscribe for the e-nach facility offered by most borrowers including Fullerton India so that your monthly EMI is auto debited from your account on a pre-set date.

How you settle your outstanding debt directly and substantially impacts your credit score. When you delay payments on your EMIs, you incur penalty charges. This lowers your credit score.

2. Flag credit report discrepancies

Sometimes, your credit report may reflect discrepancies. For instance, if a lender from whom you have borrowed money has been slow to report your timely payments to CIBIL, your credit score could be low.

If you are a borrower, you should check your CIBIL score regularly. If you spot any discrepancies, you should have the same corrected immediately.

Many institutions allow registered customers to check their CIBIL scores for free. You can simply visit their website or app, register yourself and provide the details they ask for to access your credit score free of cost.

3. Choose different forms of credit

Individuals who have not borrowed money in the past will not have a credit history. This will result in a low CIBIL score. In order to build a healthy credit score, borrowers usually rely on a mix of credits. This includes unsecured and secured loans of both short and long duration.

This practice will ensure that the next time you apply for a loan, you will be able to enjoy both higher loan amounts and lower interest rates.

4. Limit credit utilisation

How to improve CIBIL score really fast? Avoid breaching your credit card limit. A good rule of thumb is to ensure that you do not exceed more than 30% of your monthly credit limit.

For example, imagine that your monthly credit limit is Rs. 10, 00,000. To ensure that you do not cross your limit of 30%, make sure that you don’t utilize more than INR 3,00,000. If you need more funds, pay off the existing dues to the extent possible before applying again.

Borrowers who regularly spend more than 30% of their credit limit can expect a lower credit score and higher interest rate on any loan sought. Those who are interested in knowing how to increase CIBIL score should refrain from spending without checking their expense account.

5. Good Repayment History

If you are looking for an easy answer for the question how to increase credit score, the most obvious answer is to have an excellent repayment history and good debt. This is the reason why many people who are trying to increase their CIBIL score avail a personal loan and repay the same through monthly EMIs as it helps in creating an excellent repayment history.

If you have handled your home or car EMIs well and paid them in full according to the terms and conditions of the agreement, it’s called good debt. Good debts are always favourable to your credit rating. It will boost your CIBIL or credit score.

Leaving good accounts and old debt on your credit report is a good way to improve your credit score.

6. Don’t borrow often

Every time you apply for a credit card, loan, or any form of credit, the lender will reach out to CIBIL for your credit report. This inquiry will be reflected in the report. Every time a lender performs a hard inquiry on your credit report , your score may drop a couple of points. This drop becomes a lot worse for those who apply to multiple lenders within a short period of time (or at once).

A tendency to borrow betrays a behaviour that is credit-hungry. Furthermore, it also diminishes your score even if you may have had the means and the intention of repaying the debt on time.

7. Increase your credit limit

If you cross the monthly credit limit on your credit card often, you can consider approaching your bank and ask for an increase in your credit limit. When your credit limit increases, your credit utilisation ratio will decrease.

This will portray you as an individual who is in control of his or her expenses which, in turn, will reflect positively on your credit score.

We hope that this article has helped you understand how to improve CIBIL score immediately.

Apply for a home loan online from Fullerton Grihashakti website at reasonable interest rates starting from 7.99% per annum*.

*Terms and conditions apply.

Must Read : What is a Home Loan NOC and why should you get it

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