credit score: It is well known that credit score plays the most important role in getting a loan. People who have a bad credit score find it difficult to get a loan. But there are still some points related to credit score which are not widely known. For example, on what basis a credit score is calculated, or what is the credit utilization ratio. Today we will tell you about some such things related to credit score.
- First of all, know that the credit score ranges from 300 to 900.
- It is generally considered good to have a credit score above 750.
- Those who have a high credit score can easily get a loan.
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The credit bureaus keep every record
- The credit score of the customers is decided by several credit bureaus.
- Major credit bureaus include Trans Union CIBIL Experian, CRIF High Mark and Equifax.
- These credit bureaus keep a record of your monthly bill and loan installment payments.
- They calculate your credit score on the basis of certain years of records.
credit utilization ratio
- Credit Utilization Ratio (CUR) The credit utilization ratio (CUR) is the amount of use of your credit card’s credit limit in a month.
- The CUR has a great impact on the credit score. Your CUR depends on how much you use your credit card.
- The more you use your credit card, the higher your CUR will be.
Having an old credit card is considered beneficial
- Taking a loan for a long time or using a credit card for many years is considered good in terms of credit score.
- In fact, it shows that you use the loan properly. You pay the installments on time.
Do not apply again and again
- Do not apply for loans or credit cards repeatedly. It is not considered good in terms of credit score. It lowers the credit score.
Make loan payments on time
- You should pay the loan EMI regularly and should not miss it.
- Once you make a late payment or default, it can lower your credit score by as much as 100 points.
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