Taking a personal loan is not a bad idea. You can make better your credit score with your personal and also can make it lower. It completely depends on you. If you don’t repay your personal loan on time your credit score will be lower and if you pay it correctly your Credit Score will be higher.
Credit Score or CIBIL Score played an important role while you take a personal loan. Credit score stands for your loan repayment ability if you have CIBIL or Credit Score is 750 or above that means you are good at repaying your loans.
Sometimes people take a personal loan just to work on their credit score. If you have a lower credit score you can take a personal loan and repay it the proper way. Your CIBIL or Credit Score will be higher. Don’t delay the repayment and don’t go for any adjustment it redeems your scores. Every time you check your Credit Score it redeems thirty points. So do not check so much.
If you have taken a personal loan you have to pay the EMI (Equated Monthly Installments). You can borrow a personal loan from a financial institution and personal loan has a fixed interest rate so it won’t change every month. You have to pay a personal loan for less than 12 to 60 months. If you go for a long tenure for your personal loan your loan interest will be high so it is advisable to go for a short tenure. Once you have paid the whole loan your loan account will be closed by the bank and if you have repaid the loan properly, and didn’t bounce any EMI your CIBIL or Credit score will be higher for this loan.
Try to avoid taking another personal loan while you are repaying one Bank maybe charge more interest for this. As the personal loan is an unsecured loan so it already comes with higher interest. A personal loan interest rate starts from 10.99% and can be even forty-nine percent.
Financial Institutions checks your Credit Score every time you applied for any kind of loan so try to make your Credit Score 850 your loan interest will be lower as it proves that you are good at loan repayment. Some banks don’t even give a personal loan to those people who have lower Credit or CIBIL score as it proves that you haven’t paid your last loan properly. So if you are trying to make a good CIBIL Score personal loan really matters on that. Pay your personal loan installment on time, do not bounce any check, try to go for a short tenure, do not go for any loan adjustment if that is not so required because it redeems your Credit Score and you do not want to have a bad credit score.