Do you know how your credit score is calculated, know here

Credit Score: Credit score plays the most important role in getting you a loan. Those who have a bad credit score find it difficult to get a loan. The credit score ranges from 300 to 900. Generally a credit score above 750 is considered good. Those who have a higher credit score are also more likely to get a loan. But do you know how the credit score is finally determined? This is what we will tell you today.

credit bureau

• Many credit bureaus decide the credit score of the customers.
• Major credit bureaus include Trans Union CIBIL Experian, CRIF High Mark and Equifax.

What do credit bureaus do

• Keep a record of paying your bills and loan installments every month.
• They calculate your credit score on the basis of some years of records.

credit utilization ratio

• Credit Utilization Ratio (CUR) means how much you use in a month of the credit limit of your credit card.
• The CUR has a great impact on the credit score. Your CUR depends on how much you use your credit card.
• The more you use the credit card, the higher will be your CUR.

old credit card

• Your loan being very old or using a credit card for many years is considered good in terms of credit score.
• In fact, it shows that you use the loan properly. You pay his installments on time.

Do not apply again and again

• Do not apply repeatedly for loans or credit cards.
• This is not considered good in terms of credit score. This brings down the credit score.

Pay the loan on time

• Pay your loan EMI regularly and don’t miss it.
• If you make one late payment or default, it can reduce your credit score by up to 100 points.