23-Dec-2017 written by : FSI-Team
In the modern day world when credit is omnipresent, you may walk away with the feeling that credit is easily available. However, this is a statement that is true only for credit users who have a stellar credit record. Like it or not, your three digit CIBIL score is your ticket to easy availability of credit. It is therefore of utmost importance to keep constant vigil over your CIBIL score.
Ideally, you should check CIBIL score at least twice a year. You can utilize the facility of accessing a free CIBIL report once in a year. However, there are certain circumstances which warrant extra caution about your credit score. Here are four instances when monitoring the credit score should attain importance over anything else.
When you apply for any kind of credit, the lender carry out a credit assessment to assess whether or not you are likely to make repayments on time. This is when your CIBIL score comes into play as it is considered a measure of your credit health. If the CIBIL score is 750 and above (out of 900), you are considered creditworthy. Therefore whether you are applying for a personal loan, home loan or a credit card, the prospective lender will take into account your CIBIL score. It is thus important for you to ensure that the CIBIL score is satisfactory before you make that application.
Along with a background check, prospective employers are likely to perform a credit check on you when you apply for a job. A good CIBIL score and a blemish free credit report is indicative of the fact that you are responsible with credit and are thus likely to shoulder responsibilities well in the new organization. A prospective employer cannot however pull out your CIBIL report without your permission. You may therefore be asked to submit a copy of the CIBIL report with your application for your new job. It is thus prudent to avail of the free CIBIL report facility and checks that your report is in order before you make an application to a new organization.
If you conduct periodic checks on your credit report and have ensured that the credit behaviour is up to the mark, there is little reason to worry. However, sometimes you may receive an text message about a transaction on a credit card or approval for a loan that you have never applied for. If you come across any such inaccurate credit information against your name such as credit card transactions or personal loan approvals, don't neglect the situation and pull out your CIBIL report at once as may find yourself a victim of identity theft. If indeed your identity has been stolen you need to raise a CIBIL dispute without any further delay to rectify the situation.
If your credit score is not up to the mark, and you have taken it upon yourself to bring the credit records back in order, give yourself a pat on the back for that indeed is a smart decision. The first step to rectifying or improving your credit score is to find out where you have stumbled in the past. Pull out your CIBIL report to identify the problem areas to get a clear idea about what area you should be focussing on. It is range from reducing the credit utilisation ratio to letting the average age of your credit increase.
In this day and age, it is prudent to keep a hawk eye over the CIBIL score to ensure that your financial health is in order all the time. However, the above mentioned circumstances do warrant extra vigil and will require you to pull out your CIBIL report even if you have exceeded the usual number of checks you conduct in a year.