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Surviving with a bad credit score is not always easy and definitely not cheap. But if you have a good credit score, it will most certainly help you save money and make your financial life much more comfortable.
Credit Information Bureau of India Limited (CIBIL) is India’s first credit bureau that collects details of a borrower’s credit score. Higher credit score will make creditors more confident that you have an ability to repay your future debts as agreed.
The credit score is used by money lenders, credit card companies, and banks providing mortgage loans to decide whether to give you a loan and on what terms and conditions.
Here is how you can maintain a good credit score:
Pay Your Bills on Time
If you have paid your credit card bills and loan EMIs, your credit score is likely to be on the greener side. However, that doesn’t mean you will ignore certain bills that don’t get reported to the credit bureaus. Sometimes these bills could end up on your credit report if you fall behind. Don’t even leave small fine unpaid because it could wind up on your credit score. Just pay your bills and maintain a good credit score.
Manage Your Debts Carefully
Credit card balance isn’t the only account that influences your credit score. Many other factors affect your level of debt, such as loan balances and lines of credit. If you have too much debt, then it can cost you points on your credit score. It will be easy for you to maintain a good credit score if you manage your debts properly.
You can always use online Personal loan calculator before applying for a loan. This will help you plan your repayment period and even budget accordingly, so you don’t miss EMIs and stay out of the interest trap.
Get Fully Aware of What Goes into A Good Credit Score
The more you are aware of what goes into your credit score, the easier it will be for you to maintain a good credit score. Five key things that are used to calculate your credit score and can affect it:
- Your payment history
- Level of debt
- Credit age
- Mix of credit
- Recent credit
Now that you know how to maintain a good credit score, you should also be aware of its multiple benefits. Here are some of the benefits of keeping a good credit score:
Easier to Get A Loan
Maintaining a good credit score shows that you use credit wisely. When banks or other money lenders see your good credit score, it lets them know that you can pay back the money you’re asking them to loan to you.
Easier to Rent an Apartment
Apartments also routinely check credit scores for the same reason lenders do. They want to make sure that if they allow you to live there, you’re going to pay the rent in full, on time, every month. A good credit score offers them peace of mind that you are more likely to do that.
Lower Interest Rate on Loans
You might have seen commercials that offer 0% or extremely low financing? Those impressive rates are reserved only for the customers with an equally remarkable credit score. Higher the credit score, lesser, is the interest rate on loans.
Receive Better Car Insurance Rates
Some car insurance companies see credit scores of the customers while they are determining their customer’s monthly premiums. If you have a good credit score, you have a better chance of receiving a reasonable deal. If your credit score is low, that doesn’t mean that you are going to be turned down altogether by car insurance companies, but it will affect your premium rates.
Get a Job
While future employers can’t see your credit score, they can look at your credit report that includes payment history. Employers look at it from a responsibility point of view. They think if you use credit wisely, pay your bills on time and aren’t overextended, you are likely to be a more responsible employee, too.
Get the loan you want and make your dream come true
Now that you have improved your credit score, it’s time for you to get the loan you wanted. To get the loan of your dream, you need to know how much will be your Equated monthly instalment (EMI) outgo. You can use an EMI calculator to calculate the possible EMI cost for your loan.
Personal loan calculator is the online tool that enables you to calculate EMI; all you need to enter simple things such as:
- Your loan amounts
- Interest rate
- And select the tenure of your loan
With these easy steps, you will know your EMI within seconds. Personal loan EMI calculator makes loan planning easy for you.