Want a 750+ credit score? Start with THESE simple habits

Banking institutions in the country reward high-credit-score holders in the nation with faster approvals, higher credit limits, and seamless approval of personal loans and credit cards. This underlines the importance of having a clean credit profile and a solid credit score.

Credit scores are provided by leading credit bureaus such as CRIF High Mark, CIBIL, Experian, and Equifax. These scores depict the creditworthiness of an individual. The basic range of credit scores is 300 to 900, with higher scores indicating better credit repayment potential.

A credit score of over 750 also boosts eligibility for car loans, home loans, and any other forms of credit. Keeping the above factors in mind, here are seven simple yet powerful habits that can help borrowers consistently stay above the 750 mark.

1. Pay all dues on time

Timely repayment of any pending debt or credit obligations is the single biggest factor that has a direct influence on one’s credit score. To accomplish this, you should:

• Set up auto debit for personal loan EMIs, home loan EMIs, and credit card bills.
• Ensure that you never miss any due date on personal loans, credit cards, or home loans.
• Even a single missed payment can bring down your credit score.
• Such a decline in credit scores can decisively damage future borrowing potential.

2. Keep your credit utilisation low

It is prudent to keep credit card usage within 30% of the available credit limit.

• High credit utilisation signals credit stress and overdependence on debt.
• Ensure that you never borrow more than your repayment capacity allows.
• Focus on spreading expenses across multiple credit cards, if needed.

3. Maintain a healthy credit mix

A sensible combination of different loans, such as home, gold, and car loans, along with unsecured credit such as credit cards and personal loans, boosts stability.

• Keep in mind that many unsecured loans in a single portfolio can be viewed negatively.
• The idea here is to showcase a long, stable, and blemish-free credit history.

4. Avoid frequent loan and credit applications

When you apply for a new personal loan or a credit card, a hard inquiry is made on your credit profile. Such a hard check can temporarily lower your credit score. That is why you should:

• Be clear about why you need a loan and apply only when it is necessary.
• Compare personal loan EMIs, offers, and rebates before settling for any new loan.

5. Monitor your credit report regularly

Download your credit report from leading credit bureaus at least once every quarter.

• Look for mistakes, errors, duplicate loan entries, or incorrect personal details.
• Discuss the issue with the customer support team of your respective credit bureau.
• Raise disputes promptly through the appropriate channel to prevent any impact on your score.

6. Maintain older credit accounts

A longer credit history builds trust with lenders. It provides them with information on one’s repayment potential.

• Try to keep old credit cards active with minimal spending.
• Avoid closing accounts purely to ‘declutter.’
• When you sustain a decade-long credit card, personal loan, or home loan responsibly, this makes future borrowing easier.

7. Keep overall debt levels manageable

Repayment of loans should be pursued aggressively instead of borrowing quickly.

• Have the mindset of meeting day-to-day expenses with your savings.
• Consider borrowing only in extreme cases, such as medical expenses or home renovations.
• Focus on clearing out high-cost loans quickly. For example, do not delay or drag credit card bills.
• Avoid taking multiple short-term loans at once.

In conclusion, building and maintaining a credit score of 750 or higher is not difficult; it requires sincerity and conviction on the part of the borrower. Responsible borrowing habits, planning finances well in advance, and focusing on basic investing and borrowing concepts can assist borrowers in maintaining a reputable credit score.

Disclaimer: MintMoney has a tie-up with fintechs for providing credit. You will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards, and credit scores. MintMoney does not promote or encourage taking credit, as it comes with a set of risks, such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.