Factors affecting credit score !

You are probably aware that it is imperative for you to have a good Cibil score in order to qualify for a loan with an attractive rate of interest. In order to obtain a good Cibil score you need to maintain a good credit history.Now that you know the link between your credit history and credit score you are naturally keen to  do all you can to keep your Cibil credit score as high as possible. But have you ever wondered what goes into the constitution of your Cibil score? let us read through the points below :

• Your repayment history:  The first and most important thing that impacts your credit score is your repayment history. You need to clear all your bills and loan repayments well within the dates stipulated in order to maintain a good repayment history.Even a single default has a negative impact on your score.

• What you owe your lenders:  There are two basic considerations when it comes to calculating what you owe your lenders which is referred to as credit utilization. First, is the total of your credit card limits sanctioned to you and secondly the percentage of your money you are utilizing. Hence your credit utilization ratio is calculated as balance outstanding on all your credit cards as a percentage of total credit limit on all your credit cards.

• How long have you been servicing debt:  This may come as a surprise, but the amount of time you have been using credit also has an importance. Therefore, if you have been servicing debt for a longer period of time and handling it responsibly, i.e. by making timely repayments etc., it is going to have a positive impact on your Cibil score.

• The amount of new credit you have taken or applied for:  Everytime you apply for a new credit such as a loan, credit card etc, the banks and other financial institutions run an inquiry on your Cibil report to check your credit history to find out about your financial health and repayment capability.If there have been too many such inquiries on your Cibil report, it has a negative bearing on your credit score.

• The mix of credit:  Even though ours is primarily an EMI led generation, Indians are by nature averse to the idea of credit. So if you have been avoiding credit like the plague and have a single type of credit, you cannot have a good credit score, especially if you have only unsecured loans like credit cards or a personal loan. In order to score high on this ground, you must have a healthy mix of credit comprising of secured and unsecured loans and have the ability to service them well in time. Those with a mix of various credit types such as mortgage, personal loan, car loan, credit card etc. is likely to score higher than those who have a single type of credit.

A good credit score will ensure that you get a loan without any hassles at best interest rates when you really need one.
For assistance on maintaining and repairing your credit score just book an appointment with our experts at www.cibilconsultants.com

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Commonly asked questions about Cibil score !!

To have an impeccable credit history is of utmost importance these days. The way you handle your finances will impact your Cibil report and Cibil score. While a good Cibil score is your ticket to easy access to loans when you are in need of it, irresponsible credit behaviour and thereby a bad Cibil score may even harm the prospects of you attaining your dream job! Confused as to how that might transpire? Read on to find out more.

• What is a Cibil score?

Cibil Score is a numerical expression that predicts the likelihood of default of a person in the next 12 months. It is mainly influenced by your past repayment track record captured in your Cibil report. This means, if you have made payments on time on all your loans on or before the due date, it is very likely that you have a good credit score, and hence banks look at you as a good customer.

• Why is my Cibil score important?

When you apply for a new loan or a credit card, it is now mandatory for a bank to access your Cibil score to assess how creditworthy you are. A good Cibil score (above 750 out of 900) puts you in a vantage position as lenders would vye amongst themselves to offer you the best interest rates. This is because your Cibil score conveys that the chances of your turning delinquent are nearly nil. On the other hand, a poor Cibil score may lead to the rejection of your loan application altogether.

That's not all. Your Cibil score also has an important role to play if you happen to apply for certain jobs, especially in banking and finance sector, ITsector and other multinational companies as well. It has been found that those who are financially disciplined make diligent and disciplined employees in their workplace as well. Therefore, while performing a background check on you, your employer may ask you to submit your Cibil report among other documents. If your prospective employer finds that your credit behaviour is unsatisfactory, you may even be rejected as a candidate outright. It may be noted that if you are trying to find a job in a bank, a Cibil score of less than 750 will not do. However, if you approach the bank as a customer, the same bank may still consider giving you a loan if your score is between 700-750.

• What determines my Cibil score?

Your Cibil score is based on the information in your Cibil credit report. There are primarly five factors that go into the composition of your credit score. In order of their importance they are, your repayment history, utilization of credit , average age of credit accounts , your mix of credit and the number of inquiries that lenders make each time you apply for a new loan or a credit card. To maintain a good Cibil score, make all repayments of your loans and credit card outstanding on time, keep the balances on your credit cards low, keep the overall utilization of credit below 30% on your credit cards, have a healthy mix of secured and unsecured credit and finally apply for credit only when you are in dire need of it. 

• How can I access my Cibil score?

Your Cibil score is literally just a click away. You need to log on to www.cibilconsultants.com and follow the simple instructions to procure your score. You will need to fill out your personal details, make a payment thereof and authenticate your identity. Once your authentication is complete, your Cibil score will be generated.

• Does checking my own Cibil score impact my score negatively?

No. When you request for your own credit report it is considered a "soft" inquiry as opposed to that of a lender's inquiry which is considered a "hard" inquiry. Too many loans applied for in quick succession will lead to many hard inquiries which will then lead to negative impact on your Cibil score.

• How often should I access my Cibil credit score?

As a prudent practice it is good to check your Cibil score and Cibil report at least once every year. If you haven't done so, make sure you access your Cibil score and report at least six months prior to applying for a new loan. This is to ensure that your Cibil score is satisfactory and your Cibil report is free of any discrepancies.

Now that you know how important your Cibil score is and the way in which it impacts your life, it is highly recommended that you keep a check on your financial health by accessing your Cibil score periodically. Always bear in mind that it is not your income level that  important to maintain a good Cibil score, but your attitude towards handling credit! 

For availing credit related services contact us at www.cibilconsultants.com

How can small mistakes hurt your credit score ?

Humans can make mistakes and they can be big or small. In credit sphere making small mistakes can also impact your credit score harshly.Credit scoring algorithms do not understand human nature. Let us understand the concept with an example.

Rahul Sharma, had recently bought a three-bedroom apartment in an upcoming locality close to his office. He had a car and was contemplating a big car after getting his annual raise, which came along sooner than expected.

Rahul's Cibil score was around 750 points on a scale of 900 the last time he had checked while buying his first car a couple of years ago. When he decided to apply for a loan to buy a Luxury Sedan, he was in for a huge shock. The bank informed him that his application was rejected because of a low Cibil score and a couple of negative remarks in his credit report. He pulled out his personalized Cibil score and found his score to be around 610.

Rahul had delayed a couple of his car loan EMIs and a couple of his credit card payments. Delayed or missed payments get reported on your credit report by the lenders and have a negative impact of pulling down your Cibil score.

Lenders often prefer a healthy credit score from their prospective borrowers. Here is a table to give you an idea of percentage of new loans sanctioned to people with different credit scores:

Credit score	Percentage of all new loans sanctioned in this Cibil score band
<650	4.7%
650-699	5.2%
700-749	9.7%
750-599	22.8%
>=800	57.6%

Source (cibil.com)

From the above table it is very clear that people with higher Cibil score stand a higher chance to get a loan. Also, it is important to understand that as risk-based lending is kicking into the Indian market, people with higher credit score also stand a chance to get loans at a lower rate of interest.

So, after Rahul studied his personalized credit report from Cibil, he realized his mistake. He had forgotten to deposit cash into the account from where his car loan EMI used to pass. This happened a couple of times and also delayed 3-4 credit card payments. The credit card company had mentioned days past due (DPD) against his account.It slashed his credit score.

It is very difficult to assess how much of a drop in credit score you could expect because of a single missed payment.  One could expect a drop of 50 to 100 points.
Credit score can even be repaired. You need to follow a financially disciplined life.

For ascertaining your score or acquiring credit repairing services contact us at www.cibilconsultants.com 

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Let us understand the CREDIT SCORE !

In the world of finance, credit plays an important role in meeting our wishes. Be it the dream of owning a big car or a house . But getting loans easily is not true anymore. Lenders no more look at your earning capacity alone but also factor in your past repayment track record in the form of a credit score before making any kind of decision. In such a scenario associating one's name with a bad credit score may prove to be disastrous.

Are you planning a loan to buy a house of your dreams or replace your old car with a new sedan? These days it is a precursor if you are planning on a loan in the near future unless you want to be shocked with an end moment rejection. Credit score takes into account the credit history of the individual and predicts his willingness to repay the loan on time. Banks and lenders evaluate customers based on their ability to pay and their willingness to pay. Ability is your pay cheque, while willingness is your credit report and score. A higher score implies better chances of getting credit from the lenders.

Other than CIBIL,there are other credit bureaus also who provide credit scores. Of now almost all credit bureaus provide score ranging from 300 to 900. 
Higher the score, the better it is. Though this is definitely true, it's up to individual lenders to decide their acceptable level of risk. Depending on their risk appetite, they decide their credit score cut-off for accepting a customer's loan application. Also, what may be considered as a bad credit by one lender may be perfectly acceptable to another. For instance, a loan approval by one lender, might require the minimum score to be 750. Another lender might require 700 or lower. Therefore, if one lender does not accept your application on the basis of your credit score it is advisable to check with another one who might accept it. However, remember, lenders offering loans at lower credit scores, generally offer loans at a higher rate of interest. Hence a lower credit score may still get you a loan but it could work out to be a costly affair.

At present, the lenders report the credit history of their customers to all the four credit bureaus but they access only the Cibil report to make the decision. You must be wondering why? Cibil was launched in 2004 and has credit data on individuals from then on, while the others started operations in 2010 and do not have that advantage. If your credit score is high across bureau, it will act as a double confirmation that you are a disciplined and a good customer and therefore worthy of a loan at an attractive rate of interest. The good news is that you can raise a dispute resolution with CIBIL in case you come across any discrepancy in the report generated by it.

So, what are you waiting for? Get hold of your credit score from credit bureau and fulfill your wishes more economically.
Visit www.cibilconsultants.com

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Surprising Tactics Rich People Use To Grow Their Money

Let’s be honest, most of us daydream about what we would do if we were rich. We imagine doing stuff like quitting our jobs, buying a boat, and spending the rest of our lives sailing around the world. It brings a certain satisfaction dreaming about such things, but is this really how rich people spend their time?

I highly recommend you check it out if you are at all interested in someday becoming wealthy. You might be surprised to learn that most self-made millionaires are extremely frugal. In fact, out of all the millionaires they profiled, the most wealthy drove the oldest cars and had smaller homes compared to their peers.

Here are some of the most surprising tactics used by millionaires to manage (and grow) their money.

Spend Time Researching Investment Opportunities

On average, millionaires spend almost 20% of their income on investments. More importantly, these people spent time activity researching their investments. In other words, investing isn’t viewed as simply a retirement plan, but rather, one of the most important drivers of their wealth and future security.

Keep a Budget

Surprisingly, most millionaires have a budget and consider it important to stick to it. In other words, they have a plan. And in the end, this really does make a huge difference. How many people do you know who actually keep a budget?

Don’t Buy Luxury Cars

Fact is over 80% of luxury cars are purchased by non-millionaires –that is, people trying to create the illusion of wealth.

its really surprising !!

How to Negotiate With Creditors ?

If you are struggling to make your credit card payments or to pay off other debts, it may be time to start negotiating with creditors in order to avoid bankruptcy proceedings. You need to be prepared though, as they are used to people requesting some sort of concessions in negotiations and very good at avoiding them.

Keep in mind that while you’ll only be going through this negotiation once, the person you are negotiating with probably does it for a living. That means that you need to be prepared.

The first thing that you can do is make a budget and figure out how much you can actually afford to pay your creditors. Obviously, you have to be able to cover your normal bills, and they should realize that if you are unable to do so it is impossible for you to get out of debt.

At the same time, figure out how much you think creditors may be willing to let you out of. A good rule of thumb is to start around 50 percent of the bill, because creditors will rarely let you out of much more than that. Start the process by calling your creditor and making an offer. Make sure that you tell them that you cannot manage to pay off the original amount, but can pay a percentage.

Depending on the situation, you may propose a payment plan or a lump sum payment. If your offer is rejected, you’re going to begin putting on your game face and working your way up the chain of command on the other and of the line by asking for a manager. 

If you are able to come to an agreement, make sure that you get it in writing so that you do not have any legal problems down the line. Ask them to mail you a hard copy of any agreement so that it can be signed and saved.

One thing to try to throw into the negotiations is to have your creditor remove any negative comments on your credit report once the debt is settled, which will help to preserve your credit rating.

If you get stuck at any point in the process and your creditor is not being receptive, it may be worthwhile to throw the “bankruptcy,” word out there. Creditors know that if you go through bankruptcy, they will get nothing. They should prefer your offer to nothing at all.

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Know the difference between CIBIL credit score and report

This question triggered a thought in me as to a possibility of confusion among borrowers regarding the difference between CIBIL score and CIBIL report. For me, as systems develop and borrowing capacity of people enhance, it is very important that this difference is understood.

Credit score is a number arrived at by using information in your credit records submitted by all your lenders to the credit bureau. Credit score is a numerical value at a given moment of time that helps the lenders to assess the credit risk associated with lending money to you.

Higher the number means lower the risk of default for the lender. In India, a number more than 750 out of 900 is treated to be a good score by lenders when they look at CIBIL credit score.

The credit bureau may use multiple factors such as credit lines offered to you, the repayment history, credit utilisation information, and details of loans secured or unsecured loans to arrive at Cibil score.

 The score changes over a period of time and improves if you keep a tab on the extent of credit you avail of and service your loans on time. If you borrow beyond your repaying capacity and fail to repay in time, this score falls, thereby spoiling your credit profile.

However, the numerical value does not offer any other information pertaining to the borrower to the lender. That is where Cibil report comes into the picture.

Your Cibil report is a holistic document, which also includes your Cibil score. A credit report offers wide range of information, besides this. A credit report offers information pertaining to name, gender, age, address, and PAN card number that helps in identifying an individual.

Credit bureaus also have information about the types of loans you have home loan, personal loans, credit cards and the outstanding on each of these. Cibil report provides all loans' details along with age of each loan and your repayment history too. If you have defaulted on any loan or settled a loan in the past, Cibil report reveals it to the lenders.

Cibil reports also enlist number of inquiries. This is the number of times lenders have accessed your Cibil report while assessing your loan application.

By now, you must have understood that Cibil report is far more informative in comparison with Cibil score. While credit score simply gives one numerical value, credit report offers many more qualitative and quantitative inputs to the lenders along with the identification details.

 It helps lenders to take an informed decision while lending money. As a borrower you should keep a track of your credit profile. Hence, it is of paramount importance that one keeps track of one's investments and liabilities. One of the simplest ways to keep your credit profile is to leverage oneself well within our repaying capacity.

The very decision to stretch oneself at a time when saving money is a daunting task, it is crucial that you leverage less and save more. Lastly, do ask for your Cibil report at least once in a year.

A look at the Cibil score mentioned in Cibil report gives you a fair idea of where do you stand in the eyes of lenders and running through Cibil report helps you identify if there are any lapses at the credit bureau's end.

Get your score and credit report at www.cibilconsultants.com

Get negativities removed from Your Credit Report !!

Luckily, it is possible to remove something off your credit report without having to wait for years to delete automatically. It’s smart to remove something from your credit report if you’re trying to clean up your credit report for a mortgage or car loan. Perhaps the negative entries are just bothering you!

Whether you’re dealing with late payments, collections, charge offs, or foreclosures, there are several effective techniques that will clean up your credit report rather quickly.

Apply for a Credit Dispute 

Before you try anything else, you should first make sure the negative entry on your credit report doesn’t have any inaccuracies. Studies have shown that most people’s credit reports contain errors.

The trick here is to look for any errors whatsoever on each negative entry. Just because the entry itself is accurate doesn't mean the details about the entry on your credit report don’t contain errors. In fact, you’ll find out that it most likely does.

The first step is to get a copy of your credit report and closely look over each entry and check each detail against your records.

You should check the following things:

• Account number
• Balance
• Date opened
• Account status (e.g., Closed)
• Payment status (e.g., Collection)
• High Balance
• Credit Limit
• Anything else that appears to be inaccurate

Have a professional remove the negative entry

Lastly, have a professional handle it and just be done with the whole thing.They’ll take care of you.Every time you find an error, communicate what is inaccurate along with the accurate value to the hired professional. They will send the letter to the credit agencies asking them to correct the inaccuracies or remove the entry. The best part is that many times they can’t verify each detail about the entry so it’s removed.

For Dispute resolution a detailed procedure is to be followed which can be done by our experts in this domain.Book an appointment and get your disputes settled in a short frame of time !!

Visit our website www.cibilconsultants.com

How Secured Credit Cards Help You Repair Your Credit !!

There’s an age old saying that, “it takes money to make money.” Well, it also applies to credit cards and credit scores, as you have to have a card to rehabilitate your credit score. Of course, if your score is too low, then you will likely be rejected when applying for a card. So, what gives?

If you are unable to get a regular credit card at even a low limit, you may need to look into a secured credit card. Whereas a regular card is unsecured, meaning that the creditor has no collateral that they can recover if you default on the payment, secured cards have a deposit.

Usually, your credit limit is anywhere from half the size of the deposit you make to 100 percent. You leave that deposit with the credit card issuer, then make your payments each month like you would with a normal card. It’s a good idea to pay off your balance each month. If you near or reach your limit, the creditor can freeze the card and keep the deposit to avoid any losses.

By getting a secured credit card and responsibly making the payments each month, you can start the process of demonstrating to the credit bureaus and future lenders that you are capable of making payments on time.

As a result it is vital that you not miss any payments on your secured card. In addition, it’s important to make sure that the company issuing the card will be reporting to major credit bureaus. That’s because if they aren’t, those bureaus will have no way to account for your improved habits.

If you are a good customer with your secured card, it will usually be transitioned over into an unsecured card after a couple of years. In addition, after one to two years of establishing good credit habits with the secured cards, you may be able to get offers from other credit card companies.

For now, though, all you need to worry about is getting a secured card and maintaining the account without missing any payments. From there, things will begin to fall into place so that within a year or two, you should be able to be well on the way to repairing your credit score and having a decent shot at getting any new credit cards or loans you need.

Need help on your credit score ?
visit www.cibilconsultants.com

Does checking your own credit history hurt your Cibil score?

Lot of people harbour wrong notions about checking their own credit score. Here is the low down on why checking your Cibil score will not have a negative impact on your credit report. On the contrary, it will be considered a healthy practice.

There are numerous factors that go into the constitution of your credit score, and credit inquiries are indeed one of them. This means the higher the number of credit inquiries there are in a short frame of time, the worse the impact on your score.

However those inquiries that will make a difference to your Cibil score are the ones that a lender makes when you make a loan application for a personal loan, mortgage, auto loan or when you are applying for a credit card. These kinds of inquiries are called "hard inquiries". This is a practice followed by most lenders today where they pull out your credit report to find out how responsible you are with handling your debt. If you are applying for too many loans or cards in a short period of time, there will be several hard inquiries on your Cibil report.

On the other hand, if you want to check your own Cibil report and credit score, it will be considered a "soft inquiry" and will have no impact on your credit score. In fact, it is advisable that you check your Cibil score at least once annually. That way you will come to know not only whether or not you are in perfect financial health, you will also be able to report discrepancies if any.

So if you are living in fear because you thought it would be detrimental to your credit score, if you check it yourself, now is the time to bust this myth. A credit bureau is as much for you to access as is your lender's so go ahead and check your credit score whenever you deem fit.

For any assistance on credit score visit our website www.cibilconsultants.com

Develop great habits for an excellent credit score !!

Don't let your financial dreams suffer due to low credit score. Maintaining cibil score is a necessity so as to avoid loan application rejection.

Here are some great credit habits you should follow:

Spend less that you earn

"Never spend money until you have earned it" - Thomas Jefferson

You have heard your parents and grandparents give this advice often enough. It is the simple truth of being credit-wise. Living within your means and spending only what you have earned not more than that. This does not mean that you do not spend on credit cards or do not take a loan but limit the amount to one you will be able to repay according to your current spending capacity. For instance, if you are taking a home loan ensure that the loan size and EMIs that will follow are manageable and do not end up putting you in debt.

Put credit to work but do not rely it

"Expectation is the root of all evil" - William Shakespeare

While credit is necessary for asset building, it should a tool in control, Credit is not cash, It is loan that has to be repaid. While shopping it is all too easy to whip out the credit card and pay. However, the fact remains that the bill will need to be paid at the end of the credit period which is usually a few days away.

Keep paperwork in order

"I am a believer that orderliness begets wealth" - SuzeOrman

Make sure your financial information and records are organized and up to date. Set up alerts on your calendar to ensure that do not miss a payment even if the bill does not come on time.

Have an emergency fund

"By failing to prepare you are preparing to fail" - Benjamin Franklin

An emergency fund keeps you afloat in tough times when there is an abnormally high need for funds or even when there is a gap in earning. It is like a safety net that prevents you from falling into debt. Without an emergency fund, you would fall behind in your regular payments resulting in a poor credit score.

On time, every time

"The bad news is time flies. The good news is you're the pilot."-Michael Altshuler

It is important to make your repayments on time not just most of the time but each and every time. Even one late repayment will have an adverse effect on your Cibil score. One of the easiest ways to ensure timely payments is to set up an auto debit system linking your bill payments to your credit card.

Renew, Revamp and Retain your CIBIL credit score with our power packed service packages !!
Book an appointment and get desired services with an ease.
visit www.cibilconsultants.com

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Secured vs unsecured loans and their Impact on Cibil score !!

It is not uncommon for people to ask about the difference between unsecured debt versus secured debt and how they two types of debt may affect credit scores.Some loans can have the opposite effect and actually damage your score.It is important to for us to understand what a secured and unsecured loan is in the first place. 

If a loan is unsecured, it does not have any collateral. Personal loan and credit cards are the most popular unsecured loans available today.

Any loan that has collateral is considered secured loan for example, a home loan or car loan or gold loan.Any default or delay in the repayment in both kinds of loans is bound to affect the Cibil score of a person. The banks report credit limit and balance on credit card and the loan amount for personal loans. The banks also report repayment information to the credit Information companies.The same is the case with secured credit. The banks repayment all the secured loans held by and also the repayment history.

Secured loans have the largest positive impact on your credit when they are repaid. If you have never taken a secured loan, your credit may be low despite your good record of repayment.

"Non-payment of or serial delays in repayment of credit card dues negatively impact the credit score. Possession of too many credit cards and little or no secured loans can negatively impact the credit score," said Sridhar K, vice-president, Highmark Credit Information Service Pvt Ltd.

So before you decide any changes in the repayment schedule, be aware of the impact of each loan has on your credit score.

For any assistance regarding credit score and loans contact us at www.cibilconsultants.com

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Financial decisions impacting your credit score !!

It is not just your investments but also your spending habits that impact your financial future. Most of us are worried about the investments we make and are least bothered about the EMIs that go out of our pay cheque on a monthly basis. It is important to take care of your liabilities as much as you take care of your assets and here is why -

Locking away credit cards: If you have overused your credit card during holiday season so now live a  "cash only lifestyle" for some months and pay minimum amount due on the cards.

Our verdict: Poor! - High interest payments and high utilization. Though on the surface the move to pay minimum amount due looks good, but you need to realize that credit card is the most expensive form of debt and not only you pay huge amount of interest payments, you also have a high utilization on your cards and it can hurt Cibil score. However, locking away your credit cards is definitely a smart financial move!

Using debit card for purchases: Just decide that from now on if you were to make a purchase, use only debit card - Be aware that purchases on debit cards weren't reported to the bureau.

Our verdict: Good! - Yes, the debit cards are not reported to the bureau.Make a smart financial lifestyle choice by using debit card to make a purchase, and be aware that the debit card purchases weren't reported to the bureau. Only your liability accounts - accounts where you are borrowing money from the banks such as - credit cards, home loan, personal loan, overdrafts etc. get reported to the Cibil or other bureaus in India.

Enquiring too often for loan application: The first time you got your loan application rejected,  anxiety took over and you applied to three other financial institutions through a third party. The third parties guaranteed you that they would get home loan approved.

Our verdict: Poor! - No third party can get a home loan when you are not qualified to get one. When you got your home loan application rejected from the leading private bank, you should have looked into the cause of application rejection rather than trying your luck elsewhere. Like everything else in life, the easy route is never successful. You should have approached the bank, gotten a copy of your Cibil Report and taken corrective measures before approaching a different bank.

 we find many customers struggling with their loan application rejection. Don't wait till you are impacted because of your low Cibil Score. Get it repaired with the service packages we offer at our website www.cibilconsultants.com.
Hurry book an appointment now !!

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How Does Student Loan Debt Affect Your Credit?

Can student loans lower your credit scores? Well, yes—but how much depends largely on how you handle those debts. One thing’s for sure: the amount of student loan debt owed has increased pretty dramatically in just the last seven years.

How is Student Loan Debt Treated by Credit Bureaus?

Student loan debt is treated on your credit reports and scores as an “instalment loan”. That is to say, a specific loan that’s been structured over a period of time. Whether it’s a government loan or a private loan also doesn't matter.

The important thing is whether or not it’s paid-off on time, within the agreed-upon framework.

These kinds of debts are weighed less heavily than, say, credit card debt. This is where you might’ve heard the terms “good debt” and “bad debt.” Basically, student loan debt is good debt—it’s an investment in your future. With the money you’ve taken out to pay for education, ideally, you’ve increased your capacity for higher earnings over coming years.

What interests the credit bureaus most are your payment habits—not that you have debt, but how you manage the debt you have.

Of course, defaulting on a student loan will appear on your credit report—and stay there—for seven long years. Student loan payments that have gone unpaid for 270 days are considered to be in default. However, it is possible to make arrangements with lenders to avoid this. 

Ultimately, just like everything else relating to your credit, you want to demonstrate your trustworthiness and reliability. Don’t be afraid of improving yourself with a student loan, but make sure you’re ready to keep up with the payments as they come due.

For more details visit our website - www.cibilconsultants.com
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Credit Repair After Bankruptcy !!

One of the most difficult things about bankruptcy is the time that comes right after the process itself is completed. As much as it can be a relief to be out of debt so that you can get on with the rest of your life, it is also the start of an immense new challenge: credit repair.

In addition, even though lot of persons have had to file for bankruptcy in recent years, there is still a stigma surrounding it. This often keeps people from consulting with their friends and associates on the best methods they can use going forward as they try to rebuild their credit. That means that the challenges ahead are even tougher than they have to be.

There are many things that you can do after a bankruptcy proceeding to speed things along a little bit as you try to build your credit score back up. One of the first is to make sure that the debts on your credit reports are noted as part of a bankruptcy settlement, so that they do not show up as current debt. While going through bankruptcy obviously hurts your credit, it’ll be even worse if some of that debt is still showing up on your report.

Next, you should focus in on setting a budget and following it. While tough economic times can make it impossible to avoid debt problems, once you come through bankruptcy, you really need to focus on making sure it never happens again. Setting and keeping a budget is a good way to do that.

Once you’re comfortable with that, it is time to try to get another credit card. Having an active credit history is critical to your credit score, and you need to demonstrate that you are capable of being responsible with a credit card. You may need to start with a secured credit card, but no matter what it takes, it is worthwhile. 

Make sure you don’t miss any payments on your new credit card. If possible, consider setting up automatic bill payment to ensure that you are not late on any of your payments, as that would damage your score significantly. Likewise, if you have any loans that were not discharged during the proceedings, make sure you keep making payments promptly. One such example would be a student loan.

Lastly, try to keep your credit card balances low until your scores have been repaired. It’s important to maintain the right credit-to-debt ratios.

For any assistance in repairing credit score contact us by visiting www.cibilconsultants.com

Action plan for peaceful life after retirement !!

After working for 40 or more hours per week for years, the thought of relaxing and leading a stress free life after retirement sounds too good to be true. And it may be practical, provided you have planned it well for it financially. Follow these steps if you wish to retire soon:

1. Save and invest wisely:  Disciplined savings (about 20% of your income) done month on month, and invested wisely in investments like real estate, stocks and mutual funds, gold, pension plans,etc. can yield and ensure a steady flow of income during your later years.
2. Plan to pay off your debts:  High interest debts are more likely to sabotage your retirement savings, if you don't plan well. Also, housing loans usually are the long-term loans, which will take years to repay. If you plan well, you will be able to repay these loans by the time you retire, thus saving a big chunk of money for your post retirement living.
3. Refinance:  Home loan interest rates are around10.15 %. If you are paying significantly higher interest on your home loan, it makes sense to take a relook at it. You might save a huge chunk of money on the interest outgo.
4. Minimize lifestyle inflation:  Retirement can last 20+ years these days. If you minimize lifestyle inflation, then you'll have more money to put towards retirement. 
5. Buy Insurance:  It's extremely important to protect yourself and your loved ones in case something happens. Ensure you buy a life and health insurance for yourself and dependents and pay the premium on time. It's also a good idea to make a Will and update it whenever there is a significant life change.
6. Find alternate sources of income:  Having diverse income streams is always better. This way if something goes wrong with one, you have others left.
7. Have a retirement plan:  Defining a sense of purpose clearly, or keeping your to do list ready, makes the transition of working full time to doing your own stuff smooth. Happiness in retirement is a balance between staying active and staying relaxed.
   

work now and plan today to live life on your own terms after retirement !!

Tips to avoid money tiffs with your spouse !!

 The dimensions of a relationship between couples have changed today because a large percentage of workforce population today consists of women. More and more couples are raising issues regarding money. Here are some of the common money issues; which if not taken care of, can lead to arguments, which couples can avoid:

1. Share financial plans:Conflicting ideas, plans and priorities about money can lead to disagreements in a relationship. Also, controlling aspects about the finances can make partners uncomfortable. Sharing each other's money management plans and goals, preferably before marriage can give a head start to manage the finances better after wedding. Also, being transparent and honest about money to each other can earn a lot more brownie points than imagined.
2. Joint or Separate:Difference in opinion about having a joint account and bearing the common expenses together or having separate accounts and splitting the bills, can lead to major fights and arguments. Couples should realise that, there is no 'one way to handle finances'. Whatever suits them should be done as long as both the partners agree to what seems fair to them.
3. Managing debts:Whether you got into debts on your own, or as a couple, debt can cause major stress to a relationship. Couples who are mature to understand that working together as a team, not only strengthens the relationship but also helps to reduce the debts more quickly.
4. Default in payments:If you are looking forward to building that dream house together, and have applied for housing loan together, a bad credit score in one of your Cibil report due to default in credit card payments and other reasons can make your significant other go red. Helping each other in paying off balances on time can go a long way in avoiding this.
5. Attitude regarding money:If one of you is a spend thrift and the other believes in saving, chances are high that the arguments are a day-to-day affair. Couples with contradictory mindsets can have trouble agreeing on how their money should be spent. Having a personal allowance for oneself and creating a mutually planned budget for common expenses can go a long way in minimizing these conflicts. Above the partner who is a spendthrift could avoid half the conflicts by being aware of the mindset.
   

Money is a touchy topic for most of us. Money fights between couples are all about control and freedom. Keeping the communication channels open and respecting each other's attitudes can help couples manage finance better. If not, it makes a lot of sense to seek advice from financial experts, who can give you unemotional, objective suggestions. So, think about where you stand in your marital life from a financial perspective and work towards bettering it.

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Tips for best mortgage experience

 If you have decided to buy your first property the very first step you will take is shopping for a mortgage.While you may think that you will be spoilt for choice with so many lenders and products galore, but shopping for a mortgage is trickier than you think. However, it does not have to be a complicated process for you. Here are six steps that will help you get through the process smoothly.

Ensure that your Cibil report is in ship shape

The first thing that any bank will look at is your Cibil score and Cibil report to assess your home loan eligibility. It will also determine the kind of interest rates you are eligible for. It is therefore of utmost importance for you to check out your Cibil report well in advance (at least six months prior to making an application for a loan) to see that everything is in order and see if anything can be done to better your Cibil score. You must also see whether or not there are any errors in the report. For instance, there may be a loan that may be paid off from your end but does not reflect on your credit report because the lender may not have reported the closure of the same. In case of such errors your Cibil score could be negatively impacted.

Try and improve your debt to income ratio

This is an important consideration that a lender will take into account while assessing your loan eligibility. Simply put, your debt to income ratio is the amount of debt you handle in proportion to how much money you make. Before you apply for a mortgage you should therefore make an attempt either to reduce your debt or increase your income. Some ways to boost your ratio, is to start making bigger payments on your credit card or by pay off some long standing loans on which the interest outgo is large.

Plan for a big down payment

Before you shop for a mortgage, you should have ideally saved for a large down payment of 20 per cent of the property value. The larger your down payment, the cheaper it will turn out to be for you in the long run because of a smaller EMI outgo. Besides, paying a higher down payment will qualify you for better rates of interest and will tilt the deal in your favour as you will be perceived as a less risky customer.

Research thoroughly before you decide on the lender

A mortgage is a long term financial commitment that you will make. It is therefore necessary for you to choose the right bank who will give you the best mortgage experience. Check the credentials of the prospective banks you want to approach, and research online about the kind of mortgage experience others have had with them. You may also consider taking the opinion of friends or relatives who have recently taken home loans and ask for their recommendations. Choosing the right bank will ensure that your mortgage experience is smooth sailing.

Submit a thorough application

Make sure you submit a complete application with all the accurate information that the bank will require to process your loan. Along with the fully completed application form, ensure that all the papers such as salary slips, IT returns, bank statements etc. are in order.

Lock in your interest rate

The interest rate is an important factor that is primarilyin the mind of any  home loan borrower. After having discussed various implications of interest rate options with your lender, you must make a commitment and lock in your rate of interest. You can choose from a loan with a floating rate of interest, a fixed rate of interest or a hybrid loan. The floating rate will be linked to the base rate of the bank and will change as per the economic cycles. While the floating rate may seem cheaper, there will be an element of uncertainty attached to it always.

If you want certainty in your monthly outgo you may consider a loan with a fixed rate of interest. However, it will always be 1-2.5 percentage points higher than a floating rate. Depending upon your financial position and the volatility in the market, you may also decide to take a hybrid loan that is a combination of fixed and floating rate loans. In this loan, the bank will offer you a fixed rate of interest for the firs 3-5 years of the loan tenure and thereby shift it onto a floating rate regime.

Applying for a home loan may seem scary if you go into the process unprepared, but if you have braced yourself well in advance and  follow these steps you will find that getting your home loan application approved is a breeze.

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