A good credit score not only indicates a good financial status, but it also increases the chances of applying your loan application. Apart from this, there are many benefits of high credit score.
Who can be considered a good credit score?
Four credit bureau or credit rating agencies (CRAS) release credit scores in India. These include Transunion Cibil, Equifax, Experian and Crif High Mark. Transunion CIBIL is a major credit information company in India.
Typically, a good cibil score or credit score is between 750 and 900. You can check the online credit score by using the credit rating agency website or app. Meanwhile, Moneycontrol also provides facility to check credit scores through its app and website. Here you can take a personal loan of up to 50 lakh rupees on the basis of your credit profile.
Benefits of high cibil score
- Low interest rate
Loans who take more credit score of users get a loan at low interest. A high credit score is considered very good and it indicates your ability to repay your loan on time.
- Easy Report Flexibility
People with high CIBIL scores get the option of flexible repayment tenure. According to your finance plan, the facility of choosing time can help you repay the loan on time.
- Anatomy
Those whose CIBIL score is 750 or more, their loans are more likely to be approved. High credit score can also help you to get loans on the best conditions and make the application process easier, which contains less paperwork.
- Essence of pre-upward loan and credit card
Due to the high credit score, it makes it easier for you to get pre-approved loans and credit cards. Apart from this, you do not need too much document with pre-upward loan offers.
- High credit limit
Those with high credit scores usually get the benefit of high credit limit on their credit line.
- Easy access to premium credit card
An advantage of high credit score is that you can get premium credit card of major credit card companies. Nowadays, premium credit cards are giving many benefits to customers, such as airport lounge access and exemption on e-commerce shopping.
Cibils affecting the score
There are many factors that can spoil your credit score, some such special things have been told here which should always be kept in mind.
Bill payment on time
Timely payment of credit card bills and monthly installments (EMIS) can increase your credit score. On the other hand, late payment may cause a decline in credit score.
Credits utilization ratio
Credit utilization ratio means how much the credit limit of your credit card is, how much you use it in a month. High credit utilization ratio may have negative effects on your credit score.
Minimum amount payment
People are given the option to pay the full or minimum amount of credit limit used. Payment of only minimum amount can reduce your credit score over time and also increase interest on your remaining loan.
Tips to get high cibil score
Pay your EMI on time
To improve the credit score, you should repay all EMI on time. The settlement of EMI loans can have a positive impact on your credit score. You can resort to automatic service to repay the loan on time.
Credit utilization
Experts recommend that you should be careful while taking a loan, as it can also cause trouble for new credit facilities in the future. Apart from this, it is better to keep the number of loans low within a certain time. Paying existing loans is also a good way before taking a new loan.
Monitor your cibil score
Monitoring your CIBIL score and credit report regularly can help you understand your financial situation better. Apart from this, it can also be improved by detecting any mistake on time. Sometimes loan payment details are not added to your credit report. In such a situation, recognizing these mistakes and correcting can improve your credit score.
conclusion
Sometimes it is necessary to take a loan. However, you can make the process of obtaining a loan easier and costly, while maintaining financial discipline and continuously improving your credit score.
Summary
A high credit score provides many advantages when applying for personal loans. During this time, the chances of getting the loan approval increases and a low interest rate can also be offered.
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Disclaimer
This fraction/article is written by an external partner and does not reflect the work of the editorial team of Moneycontrol. This may include references to products and services offered by Moneycontrol.