A credit score is one of the most important factors in borrowing. It is a factor that determines eligibility. Loan providers decide whether to approve or deny loan applications based on online credit score. Here’s everything that you need to know about your credit score and process how to check .
What is a credit score?
A credit score is a three-digit numeric value that represents the entire financial health and credit history of an individual. This 3-digit score helps loan providers determine credit eligibility. Based on this score, individuals determine whether to approve a loan or not. A credit score helps with a low rate of interest and instant approval.
The importance of a good credit score
● High negotiation power
A good credit score makes an individual eligible for high negotiation power. An individual with a good credit score becomes an asset or business for financial institutions. This opens the scope for individuals to negotiate for better terms, conditions, and rates. The best thing to negotiate for is a better rate of interest. When you get a low rate by negotiating, your loan becomes affordable. For Business Loan visit : business loan apply online.
● Instant approval and disbursement
Individuals with a high credit score are eligible for instant approval and easy disbursement. A good credit score represents creditworthiness and eligibility. Therefore, loan providers find it very easy to get instant approval. A score above 750 helps you easily get loan approval.
● The desired amount of loan principal
When you apply for a loan, you always have the desired loan amount. It is important to get the desired amount so that your needs or emergencies can be fulfilled in the right manner. However, the principal loan amount will depend on the eligibility of individuals. With a good credit score, individuals are able to meet the eligibility criteria and get the best-sanctioned loan amount. There are high chances that the loan provider is able to sanction 100% of the desired loan amount.
How to improve your credit score?
● Make payments on time. It is important to pay your bills by the due date to have a clean track record.
● Do not keep applying for multiple loans. Every application runs a hard enquiry check that damages your credit score.
● Keep your credit account open even when you don’t use it.
● The credit utilisation ratio should be below 50%. Do not exhaust 100% of the credit limit that is offered to you.
● The credit mix should be managed well with both secured and unsecured loans.
Finishing up
How to check your credit score? Get your online credit score by visiting the official website of Clix Capital. Input the required details and get your score instantly.
Must Read : Understand Your Credit Score And Report
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