Saturday, 22 November 2014

Improve your credit history to get a mortgage

Your credit history is one of the most important parts of your application when applying for a mortgage. Bad credit or a low credit score will compromise your ability to get a mortgage, because lenders will consider you at risk of defaulting on your loan. While it is possible to get a mortgage with a bad credit rating, you might have to make some concessions in regard to interest rate and the loan amount.

The good news is that negative information on your credit score is not permanent, and positive changes in your credit habits will begin having an immediate impact on your score. Additionally, lenders use other factors to determine loan eligibility.

 • Pay bills on time each month: Particularly those for Credit cards & Loans, Bill payments will have directly impact your credit score and paying bills on time is a positive first step in improving a bad credit history.

• Check your credit history: Before applying for any mortgage, you should always check your credit report carefully; you can obtain a copy of your report from one of the major credit bureaus, which are CIBIL, Equifax and Experian.

• Manage your mortgages: People with bad credit may get approved for mortgages far below their desired amount, but having any type of mortgage on your credit report will improve your score, so consider a more modest home and fix it up.

You should also avoid making lots of applications for credit, as these searches will affect your credit rating.

You may also wish to speak to your current account provider to see what mortgages they offer and explain to them your credit history situation. If they have no products suitable for you, then at least you know without having to make an application.

Friday, 21 November 2014

How credit counselling works?

Many people think that there is no need of credit counselling to manage your credit in an efficient way. But this is not the case.

Credit counsellors look and analyse your financial situation and help you work out a plan to pay off your debt. Counsellors help to create a money management plan as well as a debt pay down plan and also provide free resources and workshops related to money management.

Credit counsellors have a deep knowledge of how to manage the debts in an efficient manner.  They guide their customers on how efficiently they can manage the credit and that ultimately will help their credit score to increase. They are also involved with negotiating with creditors to establish a debt management plan for their customers.

Therefore credit counsellors can be a complete package for your credit health.

Credit counselling usually works on these steps:

• Firstly, they will assess your current financial conditions to see how bad your credit health is.

• If there is a need for credit counselling, they will help you establish a restructuring your credit health.

• The counsellors will provide knowledge on credit and finance, and how it will help you for the rest of your life.

• They will also qualify you for lowest interest rates on loans and credit cards by increasing your credit score.

Credit Counselling hurts your Credit?

Rather hurting, opting for credit counselling will enhance your score. If you work according to the plan provided by them, it will naturally improve your score as well as your credit history.

Credit Sudhaar is India's first Credit Health management & improvement company whose goal is to help clients to Restore, Enhance and Protect their Credit and make them credit healthy.

Thursday, 20 November 2014

Monitor your credit report constantly to escape Identity theft

As we all know that having a bad credit can make you struggle to get approvals for loans, credit cards and for any type of credit. It can result into unfavourable interest rate that can cost you thousands of rupees when you take any kind of credit.

But did you know that even identity theft can damage your credit?

Identity theft occurs when someone tries to apply for any kind of services in the name of some other person. Identity theft is one of the major crimes in the world. It can damage your reputation as well as your credit profile. Also it can lead to a criminal record in your name an arrest, having your driver's license revoked or your wages garnished. Also you can lose your employment and the place you live.

How can you avoid identity theft?

Your credit report has all the information regarding the all the credits that you have taken in your entire life cycle. It contains also contains the number of enquires that have been made by you over a certain period of time.

Constantly monitoring your credit report will help you to check if there are some enquires that have been made by any other person in your name. If you detect some incidents, it can turn into identity theft

Even, there can be some accounts which are not applied by you, but are reflecting in your credit report as open. This can drastically lower your credit score and your creditworthiness.

Steps you should take?

One you figure out accounts that are not applied but you, you should take some necessary steps that will help you to eradicate the errors in your report and will make your report error free.
Firstly you should inform the bank regarding the account wrongly updated in your name. Provide all the necessary proof required by them.

Secondly you should also inform the bureau regarding the same mistake made by the bank and ask the bank as well as the bureau to kindly update the same in their record.

Thirdly you should get a copy of the credit report and check if the same have been rectified.

Wednesday, 19 November 2014

How to tackle errors in your credit report

As we all know that credit report is a report which helps the lenders and financial helpers to check the credit worthiness of the credit applicant. These reports help them to forecast the payment behaviours of the customers. It is also true that credit reports are not always accurate. They may contain some errors.

Now when we are aware of what a credit report is, it is time to learn how we can detect errors in the credit report. Errors can be minor or major.

Errors can be identified by reading the whole credit report very carefully. The credit report has the information regarding all the accounts that have been taken by a customer in his entire life cycle. It includes those accounts as well which are closed.

 Errors can be of different types like spelling mistake in the customer’s name, wrong residential address updated in the report etc. These errors can be termed as minor errors. These errors will have a small impact on the credit history of the customer.

There are some errors which can have a major impact on the credit history of the customer. Wrong account updated, incorrect status of the account, wrong outstanding amount updated in the report, etc. These are those errors which can have a major impact on the credit report and can also affect the credit history.

Errors can have a negative impact on the credit history which will also reduce your credit score. There are some steps that you should take in order to eradicate errors for your credit report.

• Firstly you should inform the lender or the financial institutions regarding the mistakes that have been identified in the report.

• Secondly you should inform the bureau regarding the same issue.

• Provide the necessary proofs to the lenders as well as to the bureaus.

• Maintain a strong follow up regarding your issue.

These are the steps that will help you to identify errors in your report and will help you to improve your credit score and increase your creditworthiness.

Tuesday, 18 November 2014

Bad credit health can make you suffer

Credit Health is nowadays termed as an important aspect in financial standing. Basically it helps lenders determine the creditworthiness of any individual for any financial assistance.

Lenders love to see factors such as mix of different types of credit accounts, timely payment on their dues, new credit, and many other factors. Applying these factors efficiently will help you to maintain your credit history in a better way.

Consumers themselves are interested in keeping their credit scores in a tip-top shape so they improve their creditworthiness. Not only it will improve their creditworthiness but will also help them save a lot of money. People who are creditworthy will immediately earn the trust of lenders and financial assistants, while people who are not creditworthy will be rejected immediately.

Lenders and financial assisters check applicant’s credit worthiness by a three digit number called a credit score. The credit score can be termed as a snapshot of their credit report. This number denotes how creditworthy an applicant is.

The credit score ranges from 0 to 900 for all the bureaus. The three major credit bureaus in India are CIBIL, Equifax and Experian. These bureaus with the help of the database maintained by them provide credit report to individuals as well as to lenders. Based on the credit report, the bureaus calculate the credit score for each individual.

A credit score of more than 750 points is considered to be a good credit score. Individuals with such score find it really easy to get financial assistance from the market and also at a relatively low interest rate. 

Maintaining a relatively good credit history and credit score will help individuals to be financially strong and will also help them to save money.

Below are some of the factors which will help you to maintain a good credit history:

• Paying your debts in time.

• Paying your loan instalments before due date. This practice will help you to maintain a record for    paying their dues on time and also will be free from paying a late fee for the same.

• The same applies for credit card. It is also seen that people paying their credit card dues will see a boost in your score when they pay off their dues on or before due dates.

Credit Sudhaar is India's first Credit Health management & improvement company whose goal is to help clients to Restore, Enhance and Protect their Credit and make them credit healthy.

Monday, 17 November 2014

What a good credit score can do for you?

Now that we have talked enough about what is a credit score, why credit score is important and how credit score can help us. Now the main question is what should be a good credit score?

Starting from the beginning, a credit score is a three digit numerical figure which is derived from your data-rick credit report. It is a critical factor for lenders to determine your creditworthiness for a loan, credit card or any other credit.

Credit score ranges from 0 to 999 for all the bureaus. The major three credit bureaus in India are CIBIL, Equifax and Experian. The banks and financial provide the information to these bureaus and these bureaus based on the data provided by the banks and financial institutions provide the credit report to them. Basically credit score is a snapshot of the credit report of that individual.

Talking about a good credit score, a score more than 750 is considered to be a good credit score. Individual having a good credit score find it really easy to get approval for loans and credit card. While people with credit score less than 750 struggle to get approval for loans and credit cards instantly.

Below are some questions that are important to know about credit score:

How is credit scores generated?

Credit score are generated based on the factors such as payments histories, debt level, types of credit and length of credit accounts which are pulled out for their credit report. These factors will determine if the consumers will pay their dues on time or not. So, a credit score summarizes the information in your credit report, which makes it easier and faster for a lender to process a loan application and make a determination.

Benefits of good credit score? 

A good credit score will help you to take credit for a car or a home or get a credit card at a comparatively lower rate of interest. This means that you will have to pay less money towards interest.

Ultimately having a good credit score will only benefit you and having a poor credit score will only damage your credit profile.

Saturday, 15 November 2014

Cleaning your credit report is a lengthy process

Credit repair is a process which helps in eliminating problematic factors from your credit report. This will help your credit report to be error free. This will hence make you creditworthy.

A person’s credit report is generally known as his credit file. The credit file contains the overall history of the credits taken by him in his entire life span. It provides information regarding number of accounts, late payments, overdue accounts, and also accounts that have been written off.

It is generally said that “Making mistakes is easy but correcting the same is a difficult task.” The same applies in case of your credit file. Mistakes such as making late payments, having overdue accounts etc. will make a negative mark on your credit report, but to remove the same mistakes from your credit report and making the report clean is a difficult task and will take time.

There can be instances that some accounts can be reported in your name which you have never applied for. These types of errors can have a negative impact on your credit report and will lead your credit score to sink.

Once you identify the errors in your report and you remove those errors from your report you will notice that your score has not increased. If you have an active trade line, then your score will increase, if not your score will remain the same.

So it is important that you have an active trade line to increase your score. Only removing errors and cleaning your credit report will not improve your score. There are also other factors that will improve your score for example having different types of credit, paying dues on time, and many more factors.

Checking your credit report frequently will help you identify errors in your report and will help you to identify factors that will improve your score.

Credit Sudhaar is India's first Credit Health management & improvement company whose goal is to help clients to Restore, Enhance and Protect their Credit score and make them credit healthy.