You may not ponder about your credit score much, but there are times when your credit score becomes crucially important–such as when you want to take out a loan from the bank.
As it is important to maintain a perfect credit score to be eligible to get crucial approvals for significant things like the home loan. The most customarily sought after loan in India is a home loan. Consumers appeal for small, medium, and substantially big-sized home loans. This is because the interest rates are combative, durations are comfortable, and one gets a tax advantage. One gets the opportunity to refurbish, redecorate, and re-build their home. One can bag a home loan for acquiring land to build a house or to build a house on land that is purchased or to even purchase an under-construction property. This can be accomplished for new or resale properties. However, the funds that are taken as a home loan by the borrower have to necessarily be used for the home only. Home loans cannot be utilized for any other personal or business necessities.
There are positive changes for the Home-Buyers as reductions have been made in home loan rates. Home loan eligibility depends upon the repayment scope, income, prevailing loans or debts and the age of the loan applicant.
Companies like Tema Fintech are facilitating Home Loans that are financially beneficial such as minimal EMIs where you can space out your installments over a longer tenure, desirable interest rates and some uniquely special advantages. This will help the buyers to attain the sophisticated home and lifestyle they have always been wishful for.
Your credit score is kind of like a report card on how financially responsible and reliable you are, which is why you want to make sure your credit score is within an appropriate range. One mistake can negatively affect your credit score, so you’ll want to avoid these common credit faults and keep your score healthy.
1. Make A Delayed Payment
You may think that a single late payment on your credit card bill is no big deal. Everyone makes a slip sometimes, right? Unfortunately, your credit card company disputes that. Not only will you get a penalty for making a late payment, but your credit score will take a dent. Fortunately, you do have 30 days to make a late credit card payment before your score gets damaged, so as long as you deal with the payment and fines swiftly, you could avoid more long-term consequences.
2. Taking On Way Too Much Credit Card Debt
You may know you have enough funds to pay off however much credit card debt you amass, but outstanding too much, and especially maxing out your credit card, can still result in your credit score taking a hit. The advice is to utilize only 30% or less of your accessible credit, or to come as close to that as possible.
3. Applying For An Profusion Of Credit
If you take out several different loans for vain reasons like vacations, you could end up with so much debt that you fail to make payments or be unable to sustain your monthly payments on time. If you are wielding your credit card, your credit card debt could overshoot a healthy percentage of your recommended credit utilization.
4. Deactivating Credit Card Accounts
When you close a credit card account, you bear the loss of the opportunity to build credit and increase your credit score. That means that, naturally, your credit score will start to diminish. You also lose whatever existing credit that account brought you, making your credit utilization amount smaller and elevating the percentage of it you are using. Especially if the account has no fees included, it can be wise to just leave it open, even if it’s unused.
5. Not Paying Heed To Your Credit Report
Your credit report tells you how your credit score is operating and can help you keep updated on if you need to do better or if you’re doing well and should keep it up. It’s important to check in on your credit score on a somewhat frequently regular basis to make sure there are no excruciating negative changes, or, if you need to increase your credit, to make sure it is rising the way it should.
Avoiding these five perils can help keep your credit score high and lenders enthusiastic to work with you. If you have made any of these errors, take steps instantaneously to correct them if you can and be cautious of their consequences moving forward. It may take a while, but you can escalate your credit score over time, no matter how low it's fallen.
Which of these mistakes do you deem to be more hazardous?