Boost Your Credit Score for Instant Personal Loan Success: When you apply for a loan, the bankers go through your credit score and judge how good your credit score is. If you have a good credit score, then you might enjoy the benefits of a low interest rate and higher credit amounts. If you want to get a fast personal loan from Kotak Mahindra Bank and improve your credit score at the same time, this blog will show you seven important steps you can take.
Boost Your Credit Score for Instant Personal Loan Success
Set up automatic payments or reminders to pay your loan EMI.
Making sure you pay your loan EMI on time is one of the best things you can do to keep your credit score high. Set up Standing Instructions (SI) with your bank or set up alerts to make sure you pay on time to avoid delays. With SI, a set amount will be taken out of your account immediately on a regular basis, usually once a month. This takes away the chance of missing payments and having to pay fines.
Pay off all of your credit card debts on time
When you apply for personal loans, your credit score will also be affected by how much you owe on your credit cards. To keep your credit score high, you need to pay off your credit card bills on time. If you don’t pay your credit card bill by the due date, it will show up as “Days Past Due” (DPD) on your credit record. This can hurt your credit score a lot.
Clear the minimum due even if you can’t pay the full amount. If you don’t, the credit company will report that you didn’t pay. Even though interest may be added to the amount, you will have more time to pay off your debts and keep your credit score from going down.
Check your CIBIL report for mistakes.
Your credit score can go down even if you have a good credit background if there are mistakes on your report.
Some of these mistakes are wrong personal information, wrong account information, wrong amounts owed or paid off, multiple accounts, and wrong collateral data. For example, if a lender makes a mistake, they might mark a loan as “current due” even though you have already paid it off and stopped the account. These kinds of mistakes can hurt your credit score a lot. Check your credit record often, and if you find any errors, you should file a dispute with the credit company. You can get a big boost in your credit score by fixing these mistakes.
Don’t send out too many credit applications too quickly.
When a loan or credit card company pulls your credit report for a credit application, this is called a “hard inquiry.” Hard questions only have a small effect on your credit score. But being asked a lot of tough questions in a short amount of time can show lenders that you might be having money problems, which raises the risk of defaulting on your credit. This could then cause the credit application to be turned down. Credit companies lower the scores of people who have had a lot of hard questions. Do some study, look at your choices, and only apply to one credit company before you apply for credit. If your credit score is low, you might want to work on it before you apply for new credit.
Get a credit card that is secured.
If you’ve closed credit accounts or not paid them back on time, it can hurt your credit score a lot, making it hard to get credit goods. In this case, you might want to apply for a secured credit card from Kotak Mahindra Bank in exchange for a set fee. When you apply for a secured credit card, your credit score is not checked, which makes it easier to be approved. If you use the card wisely and pay it off on time, you can start to rebuild your credit score. Your credit score won’t go up right away, but this is a step toward being more creditworthy in the long run.
Don’t shut down old credit card accounts.
Lenders like to see that applicants have a long credit history and have paid their bills on time in the past. If you no longer need an old credit card account, don’t close it. Keeping past accounts open may not have a big effect on your credit score, but it can help your creditworthiness when lenders look at your future credit applications.