Credit Score shows the credit value of a borrower. So lenders totally depend on credit score, which are given by the credit bureau, to decide whether the loans should be approved or rejected. Mainly the higher is your credit score ,the better will the credit value and there are the chances of your loan application to get approved.


There are four major factors that affect the credit score of a person according to CIBIL. They are as follows:


1. Late payments:

Keep a note on your EMI (Equitable Monthly Installments) cheques pass. Do not miss your payment or delay them. Missed Payment gives negative impact on your credit history that most of the lender considered determining the risk on the borrowers.


2.  High use of credit limits:

The balance on your loan can be reducing your overtime payment that is made by you. You might be hard working for making time payments on your credit cards. While increase spending your credit cards, not necessary that it will impact negative effect on your credit Score or increase in the balance on the card over time is a hint of an increased repayment burden and we may cause a negative impact your score.


Also ReadCredit Report - Importance and Ways to check it


3.  Get a home loan and not credit cards:

Lenders feel good to see a person taking up a home Loan or Car Loan over an unsecured loan (credit card or personal Loan). Home Loan and Car Loan gives long life to a credit card, but personal loan or credit cards do not help it for the same. The unsecured loan shows that a person totally depends on the credit which is something that lender scowl up. An unsecured loan is expensive so better keep away from them.


4. Credit eager:

You have just granted the loan. Wait for a while to apply for another. The borrower must wait for one year before applying for the other loan. If you have made many applications for a loan or sanctioned, any other facilities related to credit facilities. Credit eager indicates the debt burden increased, and you are less capable of additional debt or likely to have a negative impact on your score.


So walk with Caution. Use your debit card over credit card. Go for a secured loan over an unsecured loan. Try to give preference to the things in life.