The Indian personal loan market grew by 2.3 times in value and 3.8 times in volume between FY17 and FY21. While there are numerous options for online loans India, understanding how to improve one’s CIBIL score is critical. Other factors like income, age, etc., are considered, but the CIBIL score is the most crucial.
Lenders and credit issuers use it to assess creditworthiness, and a high score can help one get the best online loans India. Having a high CIBIL score is not always attainable. A few missed credit payments or a CIBIL report inaccuracy can lower the credit score.
If a person’s credit score is low, getting credit can be difficult. However, they need not give up hope, as their CIBIL score can still be improved. They can gradually raise their CIBIL score by implementing the proper tactics and changing their credit management attitude.
Tips to ensure a good CIBIL score
The range of a CIBIL score is 300 to 900, with 300 being the lowest and
900 being the greatest. If borrowers want the greatest interest rates on loans, their CIBIL score should be closer to 900. Most lenders consider a CIBIL score of 750 or higher (750-900) as ideal.
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A few tips to ensure a good CIBIL score are:
1. Check the credit report
Regularly reviewing the credit reports is a smart idea because it will reveal a loan or credit card where one has defaulted or made late payments, lowering their credit score. This aids in credit score repair because if a person sees unfavourable information on the report, such as defaults or payment delays, they can always contact the CIBIL to address the problem.
2. Resolve errors
A lower credit score could be caused by inaccurate information on a credit report. Go to the CIBIL website and report all such erroneous transactions. Within 30 days, a person must correct the situation.
3. Low frequency of applications
One reason to avoid asking for credit cards and loans too frequently is that the lender will request a credit report from CIBIL every time one applies for credit, and the inquiry will be reflected in the report.
Following each request for the report, a lender’s investigation may cause the score to drop. This will demonstrate credit-hunger behaviour, and the credit score suffers as a result, even though the person has every intention and ability to repay the loan/card on time.
4. Repay on time
Borrowers need to avoid putting off paying their loan EMIs and ensure they pay them on time. If they are having trouble paying their EMIs on time, talk to the lender right away about a restructuring plan that will make things easier for them.
5. Do not opt for immediate settlement
Many borrowers negotiate a settlement agreement with their lenders to close their loans or pay off their credit card debt. This is occasionally less than the total amount owed. While lenders may sometimes approve such requests, they have a detrimental influence on CIBIL scores.
6. Do not overborrow
People who apply for repeated loans or are nearing the end of their credit limits are more likely to have bad credit. Borrowing too much is a CIBIL red sign.
How to avail of a personal loan?
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The lender grants online loans India after carefully examining the borrower’s creditworthiness. The borrower is liable to repay the loan on schedule, but certain unforeseen situations may make this impossible.
If the borrower fails to make an EMI payment once, the lender will usually issue a reminder via phone, email, or SMS. If the borrower is still unable to make payments due to unforeseen circumstances, the lender may extend the deadline or grant a moratorium in extreme cases. However, if the EMI is not paid, a penalty may be charged, but more crucially, the borrower’s credit score would suffer a severe drop.Get personal loans from the best loan app in India, Fullerton India’s Instant Loan App.