Friday, 26 May 2017

Do not let your credit score to become unforgiving

The nightmare of a borrower is the inability to access credit when it is most needed. As easy as it may seem to access credit these days, your credit score plays a key role in determining whether you are eligible for credit. A poor CIBIL score may become unforgiving and may keep you from getting quick and easy financial help. At times like these, personal loan for low CIBIL score may come to your aid. Further a personal loan for low CIBIL score can help you rebuild your credit score.
Often people who use credit regularly tend to forget the basic rules of credit usage. As a result, they find themselves in a debt trap that is stressful and unmanageable. However, following basic discipline while using credit can make your life easier and keep your CIBIL score intact. Here are some basic things you can do to prevent a situation where your credit score comes in the way of your accessing credit.
Make timely repayments
This is of-course a crucial factor to bear in mind to keep your CIBIL score intact. Your repayment history constitutes the major part of your credit record and thus is the key determinant of your CIBIL score. The first thing to do whenever you access any type of credit therefore is to ensure that you make timely repayments. It is prudent to automate your payments or use the facilities of lending institutions to provide reminders to make repayments on time.
Keep credit utilisation low
This is another important factor that goes into the constitution of your CIBIL score. Your credit utilisation is nothing but the amount of credit you use as against the total amount made available to you. Ideally, you should not let your credit utilisation exceed 30%. Often, credit cards are culprits in bringing down the credit score of an individual, as people often use credit recklessly thus exceeding credit utilisation limit. But it is not the card issuer but the credit card user who is at fault.
Control your credit card spend
To prevent a credit card debacle, pay your entire outstanding amount before the completion of each billing cycle. The first rule of credit card usage is using your credit card to pay the amount that you are confident of repaying within your billing cycle. If you do not purchase anything on your credit card that you cannot afford to repay with the money you earn within the next billing cycle, you should not be purchasing it at all. If you can follow this simple and basic rule of credit card usage, there is a slim chance of you falling into a debt trap or facing issues due to a poor CIBIL score at a later stage. In fact, if you can use your credit card judiciously, you can build and maintain an excellent credit score. This in turn will ensure that you can access timely credit always.
How to salvage your CIBIL score with a personal loan for a low CIBIL score
Just in case you are in a situation where your credit card debt has already gotten out of hand and you find yourself in a position where you cannot access any further credit because of a low CIBIL score, fret not! for it is not the end of the world. Firstly, if your credit score is below the satisfactory level of 750 (out of 900) do not waste time approaching a traditional lender if you are in urgent need of funds.
A non-traditional lender such as a peer to peer (P2P) lender is a better option at a time like this to access a personal loan for a low CIBIL score. This is because, P2P lenders take into consideration other a typical factor (other than CIBIL score) to decide your credit worthiness. For instance, your social media footprint and your future income capability based on your current position are some of the factors that are considered by such lenders.
Once you have taken a loan for a low credit score, you are on the right path to rebuilding your credit record. By making timely repayments for this loan, you can once rebuild your repayment record bit by bit and thus salvage your credit score. Finally, a loan for a low score, may also be considered a debt consolidation loan if your credit card debt specifically has gotten out of hand. With a debt consolidation loan, you can repay your outstanding credit card debt at once, thus mending your CIBIL score at one shot.

Thus, as you can see, your CIBIL score has a very important role to play in your ability to access credit. You must therefore make a constant attempt to improve your CIBIL score. However, for some reason if your debt obligation has gotten out of hand, consider a personal loan for a low CIBIL score to salvage the situation.   

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