A good credit score has become so necessary nowadays, every lending institution asks for it before giving a loan. So it becomes immensely important for a borrower to maintain a decent score. Also, it aggregates the borrowers with low interest loans. A good credit score ranges between 750–900.

Credit Score

There are some guidelines that a borrower should follow in order to maintain a pleasant credit score

  • Always maintain a proof for all your records. This would give the credit bureau a basis to evaluate your score. And in cases of a faulty score, this proof can be shown to elevate the credit score.
  • It is a strict no to be late in your future payments. The best practice here would be to have an automatic payment system installed.
  • If you have a bad credit score, it is highly recommended to improve it. The score would get improved gradually. But just to make the lenders think that you are creditworthy, it is advisable to get a credit card.
  • It is a good practice to have a mix of 4 types of credit account types, namely secured loans, unsecured loans, credit cards and retail cards.
  • Always limit your credit card expenses. It is preferred that you only use your credit cards under 25% of its usage to keep the ratio in balance.
  • Closing your old accounts which reflects late loan payments would not increase your credit score.

Read this article on http://www.loankuber.com/content/cibil-score/a-perfect-credit-score/ which has helped me write this post. The article focuses on all the areas which would help a novice or a bad credit person to improve his/her scores.