You may have often shied away from taking a personal loan in your time of need. You may have had to finance a wedding, a medical emergency or even a new car. But you didn’t opt for a loan because you had doubts. What if it harmed your CIBIL score? What if you faced issues while trying to get a loan in the future? These are situations many borrowers deal with. But you should also know that the opposite can be true as well. You can use your personal loan to boost your CIBIL score. Here are five ways in which you can increase your CIBIL score by opting for a personal loan:
- Plan it well
If you plan it right, you are more likely to boost your credit score. Too many loan applications could mean you are credit-hungry. Instead of incurring interest on credit card liabilities, you can opt for a well-planned personal loan with timely equated monthly instalment (EMI) payments. This shows your ability and intention to pay your loan on time, and thus, boosts your CIBIL score.
- Take a low-cost personal loan
A personal loan that has a low interest rate and minimal applicable charges will help you keep your credit score high. Comparison websites can help you choose a personal loan that’s best suited for you. You need to factor in the interest rates and extra charges, and compare the total costs to find a low-cost personal loan. The best fit is usually a personal loan with a low rate of interest and minimal processing charges. When you pick a loan that you can repay without facing any problem, your CIBIL score goes up.
- Take an affordable personal loan
An affordable personal loan has a positive impact on your CIBIL score. Opting for a higher loan amount can lower your CIBIL score if you can’t pay it back on time. This also reflects your tendency to not over-borrow and stay within your means. This can lead to a better credit score. It is very important to keep your repayment capacity in mind while choosing the loan amount.
- Managed your loan well
You can boost your CIBIL score, there are so many easy ways available to improve CIBIl score and personal loan in one of them. An ill-managed loan can have a negative effect on your credit score. When you schedule your payments, set reminders for your EMI payments and pay your bills on time. Defaulting on your EMI payments is not healthy for your credit standing.
- Take a debt-consolidation personal loan
Don’t intend to take too many loans. Several payments may be hard to maintain and could lead to a lower CIBIL score. With only one loan to pay off, you can easily manage your payments and, thus, increase your CIBIL score.
A well-thought-out personal loan can offer many benefits. It can help you keep your CIBIL score high and your financial health in check. For a personal loan with low interest rates, you can visit the Bajaj Finserv website. Bajaj Finserv is one of India’s most popular non-banking financial companies (NBFCs). It offers personal loans and flexi loans at attractive interest rates and flexible tenors.