5 Reasons you need to keep a close tab on your Credit Score

Risk based pricing is the new buzz-word in the Banking industry. While applying for a loan or a credit card, the first thing Banks check is your credit score. Good credit score means you are a sought after customer by Banks and are entitled to better pricing and easier terms than the usual rack rates or standard terms. India has four Credit Bureaus- CIBIL, Equifax, HIghMark & Experian, which various banks use to pull out a credit report on a potential customer. You are entitled to One Free Credit Report each year from one of the above bureaus. Apart from these, there are a few start-ups which track your social media activity and assign you a credit score based on their proprietary algorithm. Though these aren’t being used as extensively. Gullakh also allows you to pull out a Free Credit Report and helps you improve your credit score.

Let us look at the 5 most important reasons to keep a tab on our credit scores:

Know your Creditworthiness:
Financial well-being is a part of the complete health. Any stress on the finances directly translates into the physical health. So it is advised to know the terms one can avail at any time shall the need arises. It pays to be always prepared or at least aware of the resources one can reach in times of need and at what terms. A score upwards of 750 means you are amongst the favoured ones by the Banks.

Nip the Errors in the bud:
Credit bureaus depend on the Banks to provide them information which then goes into building score for you. A close check ensures that at no point any wrong information goes into your profile to negatively impact your score. Its good to get the error rectified As Soon As Possible. The sooner you know, the faster you act on it.

Also Read: How to Quickly Raise & Improve your CIBIL Score

Dictate the terms for a Loan or Credit Card;                                                                                                     Knowing your credit score ensures that you have the bargaining chip. You know how keen the Bank is to lend to you or issue you a credit card. With a good score you can push for getting a better deal and easier terms

Avoid Identity Theft:
You need to be aware of this growing menace. By keeping a tab on your credit report, you would know of any new queries being raised by Banks or Credit cards on you. Any query raised, which you haven’t done is a Red flag and you can follow up instantly.

Manage your Credit profile:
It helps you to understand what goes behind making your credit score and you can take actions to make it better. This is a long and continuous exercise and require discipline. Its good to start early.

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