A CIBIL score is a three-digit number that shows your creditworthiness and is a key factor considered by lenders to approve your loan applications. The full form of CIBIL is Credit Information Bureau (India) Limited. A low score could stop you from obtaining credit or result in higher interest rates and fees, whereas a high score can help you get better loan conditions and interest rates.
Here we will explain the importance of your CIBIL score and the reasons you should work to keep it high. Along with discussing what constitutes a good credit score, we’ll also offer helpful advice on how to increase your CIBIL score from 600 to 750 points. You can boost your creditworthiness and your chances of being approved for a credit card with favorable conditions and a personal loan with favorable terms by following these methods.
Table of Contents
How To Increase CIBIL score from 600 to 750 points?
1. Avoid often checking your credit card scores
There’s a common misconception that checking your credit report on a frequent basis may lower your CIBIL score. However, there are two ways that CIBIL can be pulled, which most people are unaware of: soft and hard pulls. The continuous hard pull is what lowers your CIBIL score.
A soft pull is an online check of your CIBIL score. This type of request from you is considered a soft inquiry. Hard pulls are made by credit card companies or lending companies to examine a borrower’s credit record. When you apply for new credit, you raise hard inquiries.
Multiple and frequent hard inquiries can have a negative effect on your CIBIL score. To prevent the generation of hard inquiries, it is advised not to take out personal loans or any other kind on a regular basis. Thus, always use a soft pull when checking the CIBIL score.
2. Pay credit card payments on time
When repaying credit card balances, borrowers need to manage their finances. CIBIL scores are going to decrease as a result of non-payment. Users can set up automatic credit card payments or receive reminders from the system about missed payments.
3. Keep your old credit cards active
The assumption that a credit card is automatically deactivated is a common misconception, but this is incorrect. It is a bonus if you have old credit cards and no outstanding personal loans. Do not close old credit cards and keep them active; it will improve your CIBIL score.
4. Be aware of combo loan applications
You and your partner need to monitor each other’s spending when you have shared loans. Their careless spending practices may have an impact on both of your CIBIL ratings. In addition, missing payments lower your CIBIL score. Therefore, selecting a partner needs to be done carefully before filing an application for a joint loan.
5. Stop taking on too much debt all at once
Taking out multiple loans at one time indicates that your financial situation has become unmanageable. As a result, your score can be further decreased. On the other hand, borrowing and having a strong repayment history improve your credit score.
6. Heavy Use of Credit Limits
When you use more than 80% of your available credit, your credit limit may be reduced. Your spending is limited by the credit limit, which is determined based on your income. A high credit limit (over 50%) may indicate negligence and result in a low credit score (CIBIL).
7. Make payment reminders and adopt credit discipline
Paying off outstanding debts could also have an impact on your credit record. Pay your EMIs on time, with discipline, and in full. Your credit score may be lowered, as may penalties for late EMI repayments. In order to prevent any issues and ensure that your payments are handled correctly, make sure you maintain a reminder of them.
8. Choose a Longer Term When Taking Out a Loan
When your financial conditions are difficult, you can avoid missing payments or going into default on your debts by choosing to use extended-term loans. You can save money and have simple access to funds with the help of a long-term loan. If it helps, taking a longer-term mortgage could potentially improve your CIBIL scores.
9. Choose Various Credit Types
To achieve the highest CIBIL scores over time, people should diversify their credit portfolios. Long-term and short-term secured and unsecured loans should be allocated in a reasonable manner. The loan holders should have the funds required for their repayments when they have too many loans to pay off. If there is an existing debt that is due, the loan must be calculated before asking for new credit.
10. Monitor Your Credit Information Bureau Report for Several Loan Requests
For each loan that is paid off, you must keep documents according to CIBIL. It can be used to keep an eye on any differences in an already-existing credit report. Frequent CIBIL scoring prevents your score from dropping and enables quick identification of errors.
Check you CIBIL Score here.
Importance of Improving Your Score to 750
There are several advantages to having a CIBIL score of 750 or higher, such as:
- Quick loan approval;
- More lenders to select from
- The ability to negotiate the conditions of the loan
- the option of longer loan tenures or cheaper interest rates;
- the option of overdraft loans, if necessary; and
- Any discounts or offers related to processing fees or other expenses.
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How Do You Maintain a Good CIBIL Score?
We’d like to share with you three really easy-to-follow guidelines that will help you keep your credit score healthy.
Maintaining discipline: Maintaining discipline at all times is the most important requirement. We always advise that you repay your loans and credit card debt within the allotted time frames. This helps in keeping up a high score.
Maintain a low credit utilization ratio: We advise you to never use more than 30% of your available credit limit. Establishing a sound credit score will be greatly helped by this. It is advised to apply for a credit card with a higher top limit if you are having trouble reducing your spending. This will assist in meeting the thirty percent requirement.
Maintain a Variety of Debt: It is highly recommended to maintain a mix of secured and unsecured debts. Your CIBIL score will rise as a result. A credit card is an example of an unsecured loan, while a home loan is an example of a secured loan.
What does a good credit score mean?
A higher score shows better borrowing behavior; credit scores vary from 300 to 900. Standard credit score ranges are as follows:
| Range of credit scores | Criteria for credit score |
| 300-579 | Poor |
| 580-669 | Fair |
| 670-739 | Good |
| 740-799 | Very Good |
| 800-900 | Excellent |
Conclusion
For how to increase CIBIL score from 600 to 750, you need to make a constant effort and be systematic. You can slowly improve your score and establish a strong credit profile by following the wise strategies covered in this article. Remember that building a strong credit record takes time and demands discipline as well as proper financial behavior. Be patient and persistent in your efforts. You can achieve your objective of a higher CIBIL score and take advantage of greater credit opportunities and lower interest rates if you have the appropriate attitude and behavior.
Frequently Asked Questions (FAQ)
It is not realistic to instantly raise your credit score to 750. To get there, it can take several months or even years.
You may check your CIBIL score for free on a number of websites and mobile apps, such as the Navi app. A complete credit report, on the other hand, would need to be paid for and generated by accredited credit bureaus.
A personal loan requires a CIBIL score of at least 720 or 750. This score indicates your creditworthiness, which makes it easier for lenders to swiftly approve your application for a personal loan. They might also give you the loan amount of your choice with very little interest.
It could be challenging to raise your credit score in 30 days because credit reporting agencies often require 30 to 45 days to update CIBIL with new information. It may take up to 45 days to resolve even new conflicts that you raise, although disagreements involving more recent issues may require more time. But after a few years, paying back all of your loans in full and on schedule could raise your CIBIL score.
It is best if your credit report shows a CIBIL score of 750 or higher. It will help you become eligible for credit cards and personal loans. You will, however, have more difficulty borrowing money from banks and NBFCs if your CIBIL score is lower than 685.
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