Payment history is the most important part of the credit score, which helps a lender understand whether he can expect to get his money back from you. There are several ways to increase the CIBIL Score and Report.
What is a CIBIL Score and Report?
CIBIL Score is a three-digit numeric summary of your credit history. The score is derived using the credit history found in the CIBIL Report (also known as CIR i.e Credit Information Report). A CIR is an individual's credit payment history across loan types and credit institutions over a period of time. A CIR does not contain details of your savings, investments or fixed deposits, according to the CIBIL Score website.
How do I check the details of my CIBIL Score and Report?
You can purchase your CIBIL Score and Report to check your account number and other details. This report will contain complete details of your credit history across various lenders and products. This report will have detailed information on the credits such as home loan, automobile loan, credit card, personal loan, overdraft facilities that you have availed. Your reports contain five key pieces of information, which are as following
- Personal information: This section contains your name, date of birth, gender and identification numbers such as PAN, passport number, voter Id's number
- Contact Information: This section contains your present, permanent, office and other addresses and telephone and mobile numbers.
- Employment Information: This section contains your monthly or annual income details as reported by the banks and other financial institutions.
- Account information: This section contains the details of your credit facilities including name of lenders, type of credit facilities (home, auto, personal, overdraft, etc.), account numbers, ownership details, date opened, date of last payment, loan amount, current balance and a month on month record (of up to 3 years) of your payments.
- Enquiry Information: Every time you apply for a loan or credit card, the respective Bank or financial institution accesses your CIR. The system makes a note of this in your credit history and the same is referred as 'Enquiries'.
How is my CIBIL Score calculated? What is good ideal CIBIL score?
Your CIBIL score is based on your CIBIL report. Your rating is calculated based on your credit behavior as reflected in the sections like 'Accounts' and 'Enquiries' of your CIR, which ranges between 300-900. A score above 700 is generally considered good.
How to boost or increase my CIBIL Score?
If your CIBIL Score is below 700, it is a matter of worry for you, as you may not get any kind of loan. You can definitely remedy a score that is less than ideal. But raising the points will not be easy or happen instantly. However, you can make it possible with some smart money moves, diligence, and patience.
There are some guaranteed ways to increase your CIBIL Score. You need to practice 10 important suggestions that will help you to maintain a healthy credit report.
Here are 10 guaranteed ways to increase your CIBIL Score:
- Pay bills on time, budget your money, set up auto-payments.
- Keep track of EMI deadlines, set reminders for payment, pay down debt and maintain low balances
- Maintain old credit cards to strengthen and lengthen credit history
- Maintain a low credit utilisation ratio
- Take loans with a long tenor
- Customise your credit limit and avoid taking on too much debt at one time
- Check your CIBIL report to find and rectify common mistakes.
- Create your credit history by choosing different forms of loans
- Limit credit/loan inquiries and explore secured credit cards instead of high-interest cards
- Negotiate with Lenders, who may be looking to recoup any money they can get, and make possible compromises.