A credit score is an important factor when it comes to availing new credit. But at times you may not be completely familiar with your credit score or credit report which may lead to rejection of your credit application when applied for new credit. Sometimes banks and financial institutions reject your credit applications due to inadequate credit score or irresponsible repayment trends. To avoid such instances, you need to keep a track of your credit score.
If you monitor your credit score frequently then it will help you know the factor that has affects it. For example, if your missed credit card payments have to lead to a bad credit score then it can be improved only when you timely repay your credit card dues. Any missed loan EMIs or non-repayment of credit card dues can severely impact your credit score.
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Thus it makes sense to track your credit report every month. Moreover, credit reports also contain errors and thus keeping track of your credit score helps you rectify these errors on time by raising a dispute. Once your credit information is accurate and error-free you can work towards maintaining it.
There are lots of tips and tricks to improve your credit score. However, to remain familiar with your credit score, you need to plan and set-up a credit score calendar. This way you can dedicatedly track your credit score as well as work on improving it.
See Also: Credit Score India
The steps mentioned below will allow you to set up your own credit score calendar:
To be specific about checking your credit score each month you need to pick a date. This way you can remain up-to-date with your credit score, take steps to improve it and thus confidently apply for new credit.
For example, if you are planning to check your credit score each month on 7th then make sure you mark the same in your calendar. This step will ensure you view your credit score and remain acquainted with it.
See Also: Free Credit Score
It is not enough only to view your credit score? The answer is no.
Any form of new credit your impacts your credit score and thus your credit score changes pertaining to your repayment patterns.
While maintaining a monthly calendar you also need to know the latest changes that have been implemented on your credit report. You can access your credit report and view the details listed in it. Carefully go through all details to see if any entries are made by mistake or to check for errors that can be rectified.
Besides going through your credit report is good as it helps you in identifying the factors that lead to a bad credit score and the things that you need to be careful of.
One of the main benefits of checking your credit score is that you will know the best time when you should apply for new credit. Financial institutions and banks specify certain eligibility criteria for various kinds of loans like personal loans, home loans, and credit cards. So you need a good credit score to secure credit in your name. A good credit score helps you secure loans conveniently at the best interest rate.
For example, if your current score is 650 and you want to secure a personal loan then you must first check the eligibility. Generally, banks recommend a credit score of 750 and above for approving a personal loan to borrowers. Since your credit score does not belong to the preferable range, you should wait for some time until your credit score improves.
Tips to improve your credit score:
See Also: Cibil Score For Credit Card
Now that you have already set up a monthly plan to monitor your credit score, how to understand whether it is benefitting you or not?
Well, to make sure you are benefitted review your monthly plan every 3 months. Track how much your credit score has improved since you have started following the monthly monitoring plan. This way you can bring changes to your monthly calendar or incorporate ideas to improve your credit score.
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