Credit score: If you are a credit card user or a loan borrower, you must be aware of the role that your credit behaviour plays in building your credit score. Based on your repayment schedule, your credit score tends to get positively or negatively impacted, as the case may be.
For instance, if you repay your credit card bills and personal loan EMIs well in time, then it reflects positively on your credit score. On the other hand, if you falter on repayments, then your credit score gets negatively impacted.
Someone with a high credit score can negotiate for better terms and conditions with regard to a personal loan. On the contrary, someone with a poor credit score finds it hard to secure a loan, at least on convenient terms.
Notably, your credit score keeps evolving with time as you demonstrate your financial behaviour. Therefore, it is important for you to keep a tab on your credit report and review it from time to time.
Here we describe some of the key reasons for which it is recommended to review your credit report from time to time.
Review your credit report for these 3 reasons:
I. To correct errors and inaccuracies: Reviewing your credit report regularly is important to spot inaccuracies and dispute them as soon as you can, thus ensuring that your credit
II. Protection against identity theft: Your credit report is usually the first place where signs of identity theft become visible. Unauthorized accounts, fraudulent charges, or loan applications in your name could appear if someone has illegitimately accessed your information.
Therefore, regularly monitoring your report enables you to detect suspicious activity early, allowing you to take prompt action to protect your identity and financial security.
III. Tracking your financial progress: Your credit report offers a detailed snapshot of your borrowing and repayment habits. It shows key factors such as payment history, credit utilisation, and the age of your accounts, all of which influence your credit score.
Disclaimer: Mint 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 score. Mint 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.