A credit score is a three-digit statistical number that evaluates a consumer’s creditworthiness and is based on one’s credit history, which includes the number of open accounts, total levels of debt, and repayment history.
A credit score is an essential factor for any individual when it comes to any form of borrowing in the organized structure. Any lender, be it a bank or an NBFC all the organizations run a CIBIL score check. Nowadays, online websites have solved the problem of how to check credit score, because we can now simply go online, give our details and know the exact situation of our credit history.
Not only is our credit score the most important determining factor when it comes to an understanding of our credit history but also benefits in other ways. Even the rate of interest that one has to pay is determined post; the company has run a CIBIL score check.
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👉 Now the question comes: is the credit score updated?
Yes, the credit score gets updated, both upwards and downwards. Since the credit score is such an essential aspect so all of us would want to improve the credit score. A credit score can be increased or enhanced over a period of time. Untimely repayment of loan installments or EMIs, late credit card bill payments generally leads to a reduction of credit score.
👉 Here are some ways by which the credit score of an individual could be enhanced and updated:
- Making micropayments or small payments throughout the month by the credit card to keep it balanced. The small and multiple payments work on the credit factor called Credit utilization is a significant factor for the credit report.
- Getting a credit card with a higher limit and not utilizing it to the fullest.
- Every individual is entitled to get 12 free credit reports from each of the three agencies. So, check your credit report and your free CIBIL score regularly to check them for any mistakes.
- Become an authorized user of any credit service like post-paid bills, credit cards that have been used for a very long time, especially in the family. This works best for people who have little recent credit experience, and the impact can be significant. It can fatten up your credit file, give you more extended credit history and lower your credit utilization.
- Mixing up all the credit facilities you are using like a mixed bag of some credit cards, and loan or some other form of installment accounts and revolving credit will give a substantial boost to your creditworthiness.
👉 Now the next question that arises is how often our credit score is updated?
The answer to this is in fact s good news. Generally, when the credit bureaus receive any information on your accounts, they add it to your credit report in a span of one to four weeks. They typically recalculate your credit score based on this new information soon after the information is updated in the report.
However, You might not see an immediate change in your score, because very recent information doesn’t have a significant effect on your credit score.
For example, making one more payment on time will not lead to a significant jump in the credit score to jump significantly if you already have been paying the credit card bill on time for a year. But one late payment of the bill for up to 30 days can pull your credit score down noticeably.