Lenders have a way of determining how likely you are to pay back their loan. In other words, your reliability as a borrower. They do so by checking your credit score. A credit score is a three-digit number which decides your likeliness of getting a loan. It ranges between 300 and 900. A score of 700 and above is an excellent score and suggests you’re a low-risk borrower and hence, it is safe to sanction a Personal Loan to you.
Several things affect your credit score. The one topping the list is any negative remark regarding your Credit Card payments. An outstanding Credit Card payment history damages your credit score to a great extent. They are difficult to erase and will take up to seven years to have no impact on your score.
You can avoid this by paying your Credit Card bills on time and by not keeping it pending or skipping it. By doing so, not only you improve your credit score, but also saving a great deal of money charged as interest. Credit Cards have high interest rates. Thankfully, there is a solution to that too – you can get a Personal Loan, which has a lower interest rate than the rate levied by Credit Card companies.
Getting a Personal Loan resolves two things. One, it helps you save on your Credit Card interest, and two, it works to improve your credit score. Getting a Personal Loan Online is hassle-free, time-saving, and collateral-free. So, go online to find Personal Loan options with attractive terms and conditions.
If you have multiple Credit Cards, the interest built on each can go up to a massive amount. This cumulative sum is higher than the interest rate charged on the Personal Loan. Hence, it makes Personal Loans a viable option during a financial emergency, and also helps you get rid of your Credit card dues.
Not only is the interest rate of a Personal Loan lower than the interest levied by Credit Card company, but logically, one instalment is more manageable than two. Sure two is better than one, but not in this case!
It is also prudent to remember that your credit score will not improve the moment you begin repaying the Personal Loan. It will take time as the improvement, in this case, is gradual. Therefore, you need to play it smart.
By being smart, you can use a Personal Loan to improve your credit score. Here are a few tips to help you boost your credit score using Personal loans:
For any queries related to credit scores or how to use Personal Loans to improve your credit score, get in touch with the financial experts at MyMoneyMantra. They will ensure you get the right advice based on your financial situation.
To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.
Talk to our Loan Specialists toll-free at 18001034004 to know more about our products and offers.