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How to improve your CIBIL score?

How to improve your CIBIL score?
Whenever you take loans, a data is submitted by lenders to credit reporting agencies like CIBIL (Credit Information Bureau India Limited) on a regular basis. If you have not defaulted and honoured your debt obligations, you are likely to get a good credit score.

A good CIBIL score is important to improve your creditworthiness if you are planning to take a loan. A bad score means you are going to find it increasingly hard to get a loan or credit card.

Here are a few ways that can help you improve your credit score:

Avoid late payments and defaults

If you are looking to improve your CIBIL score, you would do well to avoid late payments and also defaults. As far as possible avoid skipping payments and bouncing cheques. Your payment history has a significant impact on your score.

Avoid reaching the maximum limit

If you have credit cards and have a limit of Rs 3 lakhs, make sure that each month you do not touch the near limit. In this case avoid using the credit card as far as is possible. If you have been using the limit to the hilt, it goes to show your reliance on credit cards and other similar instruments, which could ultimately have a bearing on your rating

Avoid unsecured loans and credit cards

A home loan may not be necessarily be bad, but an unsecured loan like credit cards could weigh on your credit score, because these forms of loans are easily available. As far as is possible avoid unsecured loans.

Avoid taking multiple loans

It's best to avoid taking multiple loans together like home loans, auto loans and personal loans. It goes to show that you are credit hungry and reply solely on loans. Also, avoid applying to various places for loans.


It's best to take utmost care to improve your CIBIL rating, if you are planning to take a long term loan, especially something like a home loan.

Read more about: cibil score
Story first published: Thursday, February 14, 2013, 8:42 [IST]
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