Mumbai: Credit score is a numerical representation of your financial trustworthiness. A good credit score influence everything from loan approvals to interest rates. An individual’s credit score, which ranges from 300-900, represents your creditworthiness and assists lenders with risk assessment. A higher score typically indicates better financial discipline and lower risk.
Here are five tips to boost your credit score:
1. Pay Your Bills on Time:
Timely payment of your credit card bills, loan EMIs, and other dues is crucial for a good credit score. Late payments can have a significant negative impact on your score.
2. Keep Your Credit Utilisation Low:
Aim to use less than 30% of your available credit limit. High credit utilisation can indicate financial distress and lower your credit score.
3. Maintain a Mix of Credit:
A healthy mix of secured (like home loans) and unsecured credit (like credit cards) can positively impact your credit score.
4. Avoid Multiple Loan/Credit Applications:
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Every time you apply for a loan or a credit card, the lender checks your credit score, which results in a hard inquiry. Multiple hard inquiries in a short period can reduce your score.
5. Regularly Check Your Credit Report:
Review your credit report periodically to ensure there are no errors or unauthorised transactions. If you find any discrepancies, report them immediately to get them corrected.
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