13 Sep 2020 | 5 min read
The universal pandemic due to Covid-19 & the subsequent lockdown nationwide has beaten the financial plans of many. In addition to this, unusual job losses & pay cuts have rendered stress throughout Indian families.
The reserve bank of India had prolonged the 3-month moratorium which has now been expanded for 3 months more for all personal loan term repayments which will not have an impact on your credit score.
To preserve a good credit score, it’s very essential to perceive the most important aspects of it. In this blog, you will get to know about several ways to maintain your credit score & if it has already fallen down then you will learn strategies to improve credit score so that it can be boosted while & post COVID-19.
It’s vital to learn what establishes your credit scores & credit history. With the correct financial exercise & understanding, you can take enough healing actions if your score is low.
Generally, a credit score higher than 750 is considered a perfect one. This will stand you in a good position to take out loans or a credit line.
Your credit score is extremely reliant on your capacity to repay your debts constantly. Keep a quarterly tracing of your score, if it’s below 700 then work on regularising your repayments so your score can enhance.
This may be the period when your income is unsure or irregular. Track your credit score regularly created from your respective credit bureaus. Ideally, these reports are led by 4 major credit bureaus functioning across the globe, these are: -
Banks & other financial institutions give the needed information to create authenticated scores from an active credit account of the individual or organization, financial & payment records.
If you want to raise your credit score instantly, you must repay your credit card debts. Credit card interests are among the highest in the market, this turns credit card debt very expensive. It’s suggested that you repay credit card debt completely, whenever feasible, to conserve a high credit score.
In the event, if you’re financially hit at present & are not able to repay the debt in full, make the small payments, this will turn your account in a standing position.
If you have multiple debts, for example credit cards, with different lenders, you may miss a payment date or even skip the monthly payment. It will create a havoc on your credit score. You can avail a personal loan to pay off them at once and now you will have only one payment to make in a month. As a result, you can easily pay your EMI, which will improve your credit score by many points.
As stated previously, the most vital criteria to preserve a healthy credit score is to pay off all your bills on time. It can help you boost your credit score & rebuilding it.
Credit cards may give you reward points for withdrawing cash using your credit card but do not opt for this alternative at all costs.
This holds several hidden charges, for instance, cash advance fees, finance charges, late payment fees. Eventually, it results in a debt trap at high-interest rates & badly put an impact on your credit score.
In the event, if you are in some kind of emergency and require cash, run through your savings or ask your family or friends to render fund assistance.
You can also choose a credit line such as Credy, Money-Tap, Early Salary, etc. where you can withdraw flexible amounts & fix a comfy EMI repayment tenure.
During any kind of emergency, it’s the best idea to keep an emergency fund ready for savings. Perform the same by reducing needless buying & spending only on essentials.
Get in touch with your lender & financial institutions if you’re facing any financial problems.
On the contrary, keep in mind, if someone tells you that you can boost credit score overnight then let it enter clearly into your mind, there is no such trick like that.
Only if you pursue some hygiene rules, you’ll be able to preserve a healthy credit score & this will boost your chances for sure during & post-COVID-19 for credit requirements.