How much credit score do you need to get an easy loan; Who can help you?

How much credit score do you need to get an easy loan; Who can help you?
Image Source – CreditMantri

The importance of credit scores during the Covid era is more significant than ever—the inability to move forward without borrowing amid a financial crisis. But banks are generally reluctant to lend.

At the same time, banks are competing to lend if their credit score is good.  Let’s think about what’s wrong with this. Because, here’s the impact of a credit score. A credit score is between 300 and 900 to indicate the creditworthiness of a customer.

MV Nair, Chairman, Trans Union CIBIL, said, “We need to be as vigilant about financial health as we are about physical health. Adding to the importance of this is that those with a good credit score can reap many benefits.

The credit score is an indicator of your financial health. He also demanded that the credit score should regularly be monitored to ensure that financial health improves. He pointed out that the conditions and facilities are not the same as when the credit score was first made available ten years ago.

Unsecured loans were not available at that time. With the advent of credit scores, the situation has changed, and the general public has been able to access unsecured loans. During the last three years, the disbursement of loans below Rs 25,000 has increased 23-fold. This indicates that the credit score will be even more relevant in the future.

Lending is by banks and credit reports only

Banks provide loans. It is essential to understand that a credit score is just one factor in helping you, can be considered a criterion for qualifying for a job. Just because you have a degree does not mean you can get a job.

There are many rewards to having a good credit score. One of the significant benefits of having a high credit score is getting the service faster and having better interest rates. Having a credit score minus one is not a barrier to getting a loan as there are no loans, and banks will evaluate the customer and make loans. 

How can a newcomer get a credit score?   

Credit score for new entrants as there are no loans. Banks have several ways to overcome a situation that may not happen. It uses alternative data, including the Look-Alike score, which compares the scores of others in similar cases.

Banks can also give loans considering the transactions in the account and the salary.They will get a score as soon as they start using credit cards. Getting a credit card for this is not a difficult task.

What is the best credit score? 

Loans are readily available to those with a credit score of over 750. They account for 80 per cent of the total loans extended by banks, and those with 700-750 points get a 10% loan. 

Get your free credit score from the Sibyl website once a year. If you want to monitor it regularly, you can subscribe by paying Rs 1200. In this way, you can get the benefits of a good score.

Is it a problem to check your credit score regularly? 

No matter how often you check your credit score, it will not affect your credit score. At the same time, there is another level where various institutions can constantly check your credit score, which will negatively indicate the person continually striving to get maximum loans from multiple institutions.

It does not matter if the various banks check your credit score for a home loan or other loan. But if you approach different banks for different types of loans and check your credit score, it will be harmful.

Will the score not decrease if the cheque is returned?

Return of checks issued other than EMIs will not affect the credit score. Only credit-related information collected for the credit score, and information about reviews not collected for this purpose. Credit scores will not be bad for agricultural loans written off by the government.   

Education loans cannot deny in such circumstances, which can be rectified through the concerned bank or CIBIL. If this is not possible, then contact the Banking Ombudsman. Failure to repay the loan during the Kovid Moratorium will not be considered arrears in the credit report. 

Who can help you improve your credit score?

Do not be fooled by service providers in the name of improving your credit score. There is nothing that others can do to improve your score, and only you can do that. All you have to do is download the credit report, evaluate it, make the necessary changes and improve your score.

If there are errors in the credit report, the agency and the bank should be approached to rectify them. SIP failure will not affect the credit score, and failure to do so, including auto payments, will only affect the SB account and not the credit score. 

What is the credit score of education loans?

There is no doubt that the failure of education loans will affect the credit score. There will be a one-time settlement on the credit report, and banks will decide at what age this happened and whether the situation will improve later.

If there are arrears on loan, it will also affect the credit score of the guarantor. It is also important to note that its problems can affect everyone involved in the case of joint loans. 

Problems can arise if credit cards are not used carefully 

Many credit cardholders do not pay attention to their usage. Affects credit score. Taking the maximum loan out of all the cards will give a negative indication. At the same time, if only 75 per cent of the borrowers go ahead, this problem will not arise.  

It is essential to pay your credit card fees regularly to not run into issues in the future. The credit report will not be affected if the amount demanded by the bank for the credit card is paid on time. 

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