In
this day and age where every conceivable transport you take to work is choc o
block, getting your own car is no longer a luxury. Not only can you take your
car to work, it becomes a huge relief for your family as well as they know you
are on a safe ride. Not to mention the joy rides you can take with your loved
ones at your own will!
If
you are dreaming of getting your car and are researching what may be the best
options for you, here is something you need to right away, and no we are not
talking about saving up for your car! Apart from augmenting your savings, you
need to improve your cibil score as bad credit can tow away your dreams
of owning of your own set of wheels. Here are the steps you need to follow to
increase your CIBIL score before you go ahead and book that car of your dreams.
Check
your CIBIL report
First
things first you need to know where you stand. So get onto to the CIBIL website
and follow the instruction to lay your hands on your CIBIL score and CIBIL
report. If you are at a level of 750 and above you have little reason to worry.
However, if your score is below the level of 750, you need to make some efforts
to bring it at a satisfactory level.
Are
errors pulling your score down?
If
you are fairly sure that you have been doing things right as far as credit
behavior is concerned, look out for errors in your CIBIL report. Sometimes due
to the volume of data that banks handle wrong information may be passed on to
credit bureaus. There may also be a case where a banker may not have closed a
loan account that you have already repaid in full and your CIBIL report may be
showing that you are a defaulter. If you spot any of these errors in your CIBIL
report you will have to raise a dispute with CIBIL. Dispute resolution may take
up to a month depending upon the nature of the error, so make sure you have
that kind of time buffer.
Increase
your CIBIL score
If
you intend to buy your car in about six months to an year from now, you have
enough time to spruce up your CIBIL score, just in case you have made some
errors with regards to the way you have handled credit. This needs to be
rectified right away so make sure you go about making timely repayments on all
your outstanding loans including your credit card. That is half the job done.
Next, ensure that your credit utilization or the amount of credit you have used
as compared to the total amount of credit made available to you is between
30-40%. Finally, do not apply for any other loans or credit cards in quick
succession just before you make an application for a vehicle loan. This will
make you seem credit hungry and will not put your case in good stead when
lenders are considering your loan application.
Do bear in mind that the RBI, the central
banking authority has made it mandatory for all banks to consider the CIBIL
report of an individual as a part of their credit assessment process. Thus if
you do not have a satisfactory CIBIL score, it is likely that your loan
application can be rejected at the very beginning.
Research
before your purchase decision
Armed
with a good CIBIL score, you are ready to check out lenders and compare car
loan interest rates. Before you approach a bank, make sure you have done
adequate research yourself. You can use the services of various web aggregators
who provide auto loan EMI calculators and comparison charts that will
help you make an informed decision.
Also
make sure your papers for your car loan application such as salary slips,
identification documents and the likes are in order so that your loan
application can be processed swiftly in a hassle free manner. Once you have a
good CIBIL score you will also be at a vantage point to bargain better with your
lender on your car loan interest rate.
A
trustworthy customer is always a prized catch for any bank and a good CIBIL
score may just be your ticket to a car loan at an attractive rate of interest.
Once your loan goes through it is only a matter of time till your dream car
arrives at your doorstep! So enhance your credit score and get ready to
be known as a car owner!
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