Top Five Easy Ways to Improve Your Cibil Score.
There are a few things you can do to improve your Cibil Score or Credit Score. Here are the top five easy ways to improve your credit score as stated below.
1. Make payments on time
2. Keep balances low on revolving credit cards
3. Don’t close old credit cards to improve the length of your credit history
4. Don’t apply for too much credit to avoid inquiries
5. Always pay off your highest interest debt first
Make payments on time:-
Delay payment, even if a matter of few days and collections would make a significantly negative impact on your Cibil Scores. Use payment reminders through your banks' online portals if they offer the option. Consider enrolling in automatic payments through your credit card and loan providers to have payments automatically debited from your bank account, which are commonly known as ECS.
Keep balances low on credit cards:-
Your credit utilization, or the balance of your debt to available credit, contributes 30% to a Cibil Score's calculation.
It is very important to pay the total amount due to your credit card, it requires financial discipline to maintain your credit card bill under 30% of your total credit Limit, high outstanding debt can negatively affect your Cibil score.
Don’t close old credit cards to improve the length of your credit history:-
It's very important that you should never close your old credit cards as closing old cards do not help to maintain Long credit history and thereafter not helpful to maintain your cibil score. Between new and old card one should always use old one under 30% of your credit limit.
Don’t apply for too much credit to avoid inquiries:-
If you keep on applying for new cards and loans with different banks in a short period of time, then this approach could backfire and actually lower your credit scores. Whenever you get a call from any credit card company or loan you should never say yes until and unless it's absolutely required.
Always pay off your highest interest debt first:-
Talking about paying your debt its important that everybody should pay off debt which has a higher interest rate.
In terms of interest rate, Credit cards commonly have more interest rates than other debt, where interest rate for a credit card could be more than 28 to 36%. Apart from Credit cards, Personal loans also have more interest rates which could possibly stand at 12 to 18 % and in some cases more than that.
There are a few things you can do to improve your Cibil Score or Credit Score. Here are the top five easy ways to improve your credit score as stated below.
1. Make payments on time
2. Keep balances low on revolving credit cards
3. Don’t close old credit cards to improve the length of your credit history
4. Don’t apply for too much credit to avoid inquiries
5. Always pay off your highest interest debt first
Make payments on time:-
Delay payment, even if a matter of few days and collections would make a significantly negative impact on your Cibil Scores. Use payment reminders through your banks' online portals if they offer the option. Consider enrolling in automatic payments through your credit card and loan providers to have payments automatically debited from your bank account, which are commonly known as ECS.
Keep balances low on credit cards:-
Your credit utilization, or the balance of your debt to available credit, contributes 30% to a Cibil Score's calculation.
It is very important to pay the total amount due to your credit card, it requires financial discipline to maintain your credit card bill under 30% of your total credit Limit, high outstanding debt can negatively affect your Cibil score.
Don’t close old credit cards to improve the length of your credit history:-
It's very important that you should never close your old credit cards as closing old cards do not help to maintain Long credit history and thereafter not helpful to maintain your cibil score. Between new and old card one should always use old one under 30% of your credit limit.
Don’t apply for too much credit to avoid inquiries:-
If you keep on applying for new cards and loans with different banks in a short period of time, then this approach could backfire and actually lower your credit scores. Whenever you get a call from any credit card company or loan you should never say yes until and unless it's absolutely required.
Always pay off your highest interest debt first:-
Talking about paying your debt its important that everybody should pay off debt which has a higher interest rate.
In terms of interest rate, Credit cards commonly have more interest rates than other debt, where interest rate for a credit card could be more than 28 to 36%. Apart from Credit cards, Personal loans also have more interest rates which could possibly stand at 12 to 18 % and in some cases more than that.
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Nicely elaborated
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