Are you someone who is constantly going through the ads of Buy Flats in Kochi ? Or have you been thinking about availing the facility of home loan for flats? Well, you must certainly consider the points mentioned in this article on ‘how to improve your credit score’ then, which will absolutely turn favourable to you as you prepare for and plan about purchasing a flat or seeking a home loan.
What Is a Credit Score?
Credit scores are indicators that talk about the credit worthiness of an individual at any given point of time. A credit score is calculated after analysing the individual’s credit files and is used to determine and come to a conclusion whether the individual is credit worthy or not. The prescribed limit of credit score is essential for the obtaining of loans from banks. Hence, consider improving your credit score before you seek a loan.
A CIBIL score of 700 and above is generally considered good by most of the banks and financial institutions.
How to improve your Credit Score for a Home Loan?
- Clear the balances on credit cards
Your chances of having a low credit score could be because of any uncleared balance amount that is remaining unpaid. This could hinder your home loan grant from the banks or non-financial institutions. Hence, pay your credit card bills on a regular basis and do not allow balance accumulation.
- Paying your EMIs on time
Wondering about how to improve your credit score? Paying your EMI without fail is a major factor to be considered. Any outstanding amount or a penalty issued can all have a negative impact on your credit score.
- Ensure to close loans you no longer use
Before you set off in the search for a home loan for flats, ensure to close any previous loans that are no longer in use. Lessen the risk of exposure to unused loan accounts and improve your chances of getting a home loan in a timely manner.
- Liquid assets improve credit score
Possessing of stocks, life insurance policies, bonds and other such liquid assets can greatly improve your credit score, as this projects the financial stability of the applicant.
- Good employment status
A background of having a steady and consistent employment is a factor that the banks or lending agencies measure, while you approach them for a home loan. A constant and consistent employment is a good indicator that you have a steady flow of funds over a course of time.
- Applying with different lenders hampers the credit score
To buy flats in Kochi and avail for a home loan are two complementing activities. But, consider to not apply for loans at different banks all at once as this gives an impression of financial instability. The lender checks for ‘footprint’ left behind on your score. Hence consider this a very important aspect.
- Paying off an outstanding collection amount
Make sure to not have any kind of outstanding dues for at least a period of six months prior to applying for a home loan. Paying off all dues on any outstanding collection amount is recommended to improve credit score.
If you are looking forward to get home loan for flats, do consider these points on how to improve your credit score which would definitely turn favourable.