In my earlier post, I have written about What is CIBIL report?. This report is used for knowing your credit history with all the financial institutions. This reflects your actual capacity of repaying the loan or your character on financial matters. This report is important for the banks to approve any new loans or credit cards. This article explains the important points to remember to improve your credit history.
There are certain importance given for the details in the report, which we will discuss in this article. If you have any doubts, please post it in the comments section. Subscribe to our future articles here.
Remember Below Points to Maintain Good Credit History
- Always pay your bills on time. Late payments are viewed as the negative guidance on your financial status.
- Keep the loans and credit cars balance low. It shows that you are financially well able to manage without need of much loans. This gives positive guidance to the banks to offer loans.
- Also have the mix of credits like loans, credit cards, etc. For example, having multiple credit cards for one person doesn’t look for your financial status. Even if you have multiple cards, use only one card will show that you don;t depend on multiple credit cards.
- If you paying the loans through EMI, don’t miss any of the EMI. It is advisable to auto-deduct from the bank account (nowadays this method only used by each loan). Keep checking that you have enough money in the bank account to pay the monthly EMI. If the EMI is returned, it will adversely affect your reputation with the bank and reflect in the credit history.
- Also, you have to be very careful when taken the joint-loan and paying the money together. If your co-applicant is not correct, that will affect you. You need to monitor your co-applicant that he pays the money on time.
- It shows good when you prepay the loan before the actual tenure. If you are prepaying the home loans or auto loans before the actual completion date, it will reflect as you are financially sound and good in closing the loan account. Bank will not fear on default payments from you.
- Review your credit history periodically to ensure that everything is proper on your name. Some times banks may not upload the data or miss some thing.
- You can request CIBIL for the Credit Information report (CIR). This report will show the complete details of your credit history.
The above points are only the suggestions to improve and maintain your good credit history. Apart from the above points, banks will use their own verification to sanction individual’s loan application. But, it judge the loyalty of application, banks mainly use the Credit Information report (CIR) from the CIBIL. So, it is necessary for you to spend some time on reviewing your credit history. If you have got this report and want to share your ideas, please post it in the comments section.