Skip to main content

A Good Credit Score can make Access to Loans easier



Since the growth of the credit information industry, the only implemented generic scoring model that has been introduced and is being used extensively by lenders in India is the Cibil TransUnion Score.


Through advanced analytics, this score assigns a number from 300 to 900 to a borrower based on the credit history. The higher the numerical value of the score, the lower is the risk associated with the individual. Here is how you can manage your credit score for deriving maximum benefit for accessing credit and developing this vital reputational collateral.


Almost all the credit institutions in India use the Cibil TransUnion Score while deciding on the loan application of a consumer. It is, therefore, imperative for you to access your credit score before applying for a loan to get a precise understanding of your credit standing and the likelihood of the loan approval. This will enable you to see yourself as loan providers do and make prudent borrowing decisions. Therefore, as a first step to managing your credit score, it is imperative to know what your current Cibil TransUnion Score is.


You can know your score by accessing it from Cibil along with your Cibil CIR for . 450. The payment can be made by following an online payment procedure or through a demand draft. Along with the application form and online payment receipt or demand draft, you will have to submit documents as identity and address proof.


Once you have accessed your score it is important to review it and understand how your credit score has been derived.


Your Cibil TransUnion Score is calculated based on the information in the "accounts" and "enquiry" section of your Cibil CIR. A majority of the score is made up of the following factors:

CREDIT UTILISATION:

How much credit is the consumer using?

DEFAULTING:

How many accounts are past due date – how much and by how many days?

NUMBER OF ENQUIRIES:

Has the consumer applied for additional credit lines?

TRADE ATTRIBUTES:

How old are the consumer's lines of credit? What type of credit does he have? Does the consumer have a good mix or balance of credit or is it all credit cards?
Now that you know your score and the broad factors that determine the credit score, it is imperative to understand how to manage your credit score. Here are some ways to make sure that you are being financially disciplined and, thereby, maintaining a healthy credit score:

EMIS:

Pay your loan EMIs on time. If you have more than one loan running, it is prudent to track it well. Make regular and timely re-payments of your loan to maintain your credit level.

CREDIT CARD:

Never fail to pay the minimum payment on your credit card. Credit card is categorised as revolving credit and it helps in building a good credit score if payments are regular.

CREDIT EXPOSURE:

Do not apply for loans or credit cards if not required, as this would mean more credit exposure. This could affect your credit score. Instead of applying for another loan, try checking for a top-up loan option on your existing loan. This will make your debt burden easier to manage.

REPAYING DEBT:

Use some of your savings to repay some of your debt. Always plough back extra income to reduce your debts.

REVIEW:

Review your credit history and credit score frequently, throughout the year.
For maintaining a good history and subsequently a worthy credit score, you should ensure that you are always in control of your finances.


Remember, a good credit history results in speedier access to credit. It is beneficial to both the credit grantor as well as the borrower.


However, if your credit score is low, don't be disheartened. The credit system always gives chances to improve. You can start improving your credit score by simply paying off your debt and not opting for more until your score improves. Better late than never!

 

Popular posts from this blog

JP Morgan launches Emerging Markets Opportunities Equity Offshore Fund

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 JP Morgan launches Emerging Markets Opportunities Equity Offshore Fund    The new fund offer opens for subscription on 16 th June and closes on 30 th June. JP Morgan Mutual Fund today announced the launch of its open end fund of fund called Emerging Markets Opportunities Equity Offshore Fund. The fund will invest in an aggressively managed portfolio of emerging market companies in the underlying fund - JPMorgan Funds - Emerging Markets Opportunities Fund, says a JP Morgan press release. Noriko Kuroki, Client Portfolio Manager, Global Emerging Markets Team (Singapore), JPMAM said, "Emerging markets have been out of favour for several years, as growth decelerated and earnings struggled. However, in a world of globalisation, we believe that EM will eventually re-couple with DM, leading to the long-aw...

Nifty F&O

  1. What is a straddle? A strategy using Nifty options usually before a major event or when one is uncertain of market direction. Comprises purchase of a Nifty call and put option of the same strike price. Usually strikes are purchased closer to the level of the underlying index. 2. What is better ­ buying or selling a straddle? It depends.Implied volatili ty of options, or near-term expectations of price swings in an un derlier like Nifty , usually peaks before an event and falls when the outcome plays out ­ like Infy re sults in past years. However, once the event plays out, a sharp rise or fall in Nifty could result in price of the straddle rising ­ benefiting buy ers. But, normally , those who sell or write options charge hefty premiums from buyers in the hope that fall in volatility would ensure the options end out-of-the-money, hurting buyers. 3. So, do straddle sellers end up winning most of the time? Yes. That's invariably the case when market volatility is trending on the...

L&T Long Term Infrastructure Bond 2012 Tranche 2 Application Forms

Application form for Tax Saving Long Term Infrastructure Bond     L&T Long Term Infra Bond Application form     Submit filled up application     Collection canter near you     --------------------------------------------- Invest Tax Saving Mutual Funds Online Mutual Funds Online   Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications   ---------------------------------------------   How to apply to PFC Bonds? Apply for PFC Tax Free Bonds forms below Download PFC TAX Free Bond Application Forms Submit the filled up form to Collection canter near you How to apply to NHAI Bonds? You can download the NHAI Tax Free Bonds forms below Download NHAI Tax Free bond Application Forms Submit the filled up form to Collection canter near you        

Stocks with a high dividend yield

Buy Gold Mutual Funds Invest Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Call 0 94 8300 8300 (India) Stocks with a high-dividend yield can provide investors additional cash flow. More importantly, it is tax-free   With April 2011 just over, the 'earnings season' is well and truly here. This is the time most companies pay out a portion of their profits as dividends to shareholders. Since dividends are tax-free, they are an attractive income source with a select class of investors, who depend on these for additional cash flow. SIGNIFICANCE A company doing well and generating profits will usually be in a position to declare dividends regularly. Hence, a key parameter one should look at whilst investing in a stock is whether the company has a good dividend record. Typically, dividend yield stocks are large-caps and generally not capital-intensive. This is suggestive of the fact that the downside risk on...

UTI Equity Fund Invest Online

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)   UTI Equity Fund   Invest Online UTI Equity is a large cap-oriented fund with assets under management worth Rs. 2,269 crore (as on June 30, 2013). The fund was originally launched in May 1992 as UTI Mastergain and is benchmarked against S&P BSE 100. A couple of years back the name of the fund was changed to UTI Equity Fund and many of the smaller funds of UTI were merged into this fund. Performance The fund has outperformed its benchmark as well as the equity diversified category average in the last one-, three- and five-year periods. It has repeated the same in 2013 (as on May 31). Since its inception the fund has delivered an impressive 26 per cent compounded annual growth rate which is superior to its benchmark performance in the same period. Y...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now