What is a credit score: from
This is a statistic based on your credit history, repayment habits and other financial data collected by the rating agency from financial institutions. Your credit score is an indicator of your credit rating. This data is collected by the rating agency based on a key or unique identifier [such as a permanent account number [PAN] - issued by the Indian Income Tax Department] or SSN in the United States. Each rating agency can assign different weight ages to different parameters used to determine it. Usually, it ranges from 300 to 850.
Through the credit score check, the lender can understand the possibility of the borrower defaulting in case he/she gets the loan/credit facility. The higher the credit score, the greater the chance of getting a loan at a cheaper price. It is important to check it before applying for a new loan or credit. Credit scores below 600 are considered to be poor, and financial institutions generally avoid providing loans to these individuals. By maintaining financial discipline, you can also easily improve it. Very small things or ignorance can seriously damage your credibility. By paying little attention to these small things, you can improve your credit score and take advantage of cheaper credit facilities.
In order to improve your credit score, you should follow certain requirements and do not.
DOS
1. Never delay payment of installments for existing loans.
2. Pay credit card bills in a timely manner. If possible, use the ECS or Auto Debit Card tool on your card bill so you can't forget your bill payment until the due date.
3. If possible, try to prepay the existing loan. Making additional payments in addition to your EMI or installment can not only help you reduce your interest, but also help you improve your credit score.
4. Maintaining good and long-term banking relationships with existing bankers can help you improve your credit score. Frequent replacement of your banker, especially with business-related credit instruments, may disappoint them.
5. It is also necessary to pay electricity, mobile phone charges, insurance fees, municipal taxes and other utilities in a timely manner. While these do not directly report credit scores, these can help you maintain a financial discipline.
唐' TS
1. Don't get different loans from different banks. Try to use the maximum credit limit of one or two banks. For example, you have two home loans, two car loans, and one personal loan, each from a different bank. This arrangement will lower your credit score. Try to transfer these five loans to one or two banks.
2. Do not transfer your credit card balance from one card to another. The balance of switching from one card to another means that you have no way to pay for your credit card bill. This seriously damages your credibility.
3. Do not make full use or excessive use of credit card limits. If you reach a limit of more than 90% on a regular basis, ask your credit card issuer to increase your credit limit.
4. Do not stop using your old credit card without any reason, or because you purchased a new card. The longer the credit history of paying bills on a regular basis, the higher the credit score.
5. Don't take too many credit cards from different banks. Keep up to 3-4 cards with the same number of banks. If you use these cards regularly and pay your card bills on time, your card company will be happy to increase your card limit.
6. If there is no extreme emergency, please do not withdraw cash from the CREDIT card through ATM. Frequent withdrawals of cash from a credit card account will lower your credibility, but use a debit card associated with your savings account for cash withdrawal.
Try to get your credit score once a year so you know your position. If you find any errors in any reported transactions on your worksheet, please report them immediately to the relevant financial institution for correction and update with the rating agency, especially if you plan to adopt a new loan/credit tool.
Orignal From: How to improve your credit score - Dos and Don' ts
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