The credit score should be good to get any kind of loan or credit card. But initially, not all credit scores are good. But here we tell you about 8 easy methods, with the help of which you can improve your credit score.
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Start with a credit card
A credit score is a good option to improve your credit score. If you have a salary account or a fixed deposit in the bank, then you will easily get a credit card. You can use a credit card for your expenses and keep making payments on time. By doing this, your credit score will improve.
Use a secured credit card
Now, if you are not getting a regular credit card, then you can get a secured credit card. In this credit card, the limit is given in exchange for a fixed deposit. For example, a limit of Rs 20,000 on an FD of Rs 20,000. You will get this credit card from banks like SBI, ICICI, and HDFC. If you spend within the limit and pay on time, your credit score will improve.
Take a loan for small needs
To build a credit score, you can take a loan for small needs. For example, you can buy a mobile, furniture, or gadgets on loan. Personal loans are available on many fintech platforms at low processing fees. Paying EMI on time strengthens the credit score.
Take care of the payment
If you make a payment on time, then your credit score is good. If you pay a loan or credit card late, then your credit score can be harmed. In such a situation, you should use the facility of auto-debit.
Take care of the limit
Take care of the limit while using a credit card. Keep the usage limit less than 30 percent. For example, if your limit is Rs 20,000, then do not spend more than Rs 60,000. Excessive use of the credit limit can bring down the credit score.
Do not make many applications at once
Avoid using excessive loans or credit cards. Every day, there is a hard inquiry on the application, which reduces the score. Think carefully before applying for new credit. By applying regularly, you are considered a stable borrower.
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Keep an eye on the credit report
Be sure to check your credit report once every year for free. Apps like BankBazaar, Paisabazaar, and PhonePe also help in tracking the score. If you see any mistakes in the report, immediately go to the credit bureau’s website and ask for a correction. A clean report is the foundation of a strong score.