If you check your credit score regularly, you always stay updated about any changes to your credit score. If there’s a fall, you can track down the reasons sooner and remedy the same before it gets damaged further. Likewise, an increase in your credit score should also be reviewed to see what actions help in building a good credit score.
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Benefits of Checking Credit Report Regularly
Some of the important benefits of regularly checking your credit report are:
1. Know the Effect of Your Actions on Your Credit Score: Regular credit score checks can help you monitor your financial actions. This way you’ll know if your actions are affecting your credit score positively or not. If you know what may bring down your credit score, you will be able to avoid that and get better offers on personal loans, home loans, etc. in times of need.
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2. Ensure Accuracy of Information: Sometimes a low credit score can be the result of an error/ inaccuracy of information in your credit report. If that’s the case, you should report it immediately to the concerned credit bureau as well as your bank to get it corrected.
3. Know Better Credit Card or Loan Offers: Checking your credit score regularly also makes you more aware of when you are more likely to access an additional loan or credit card or if you can negotiate better terms of credit on an existing or a new loan/ credit card. A high credit score increases your credit-worthiness and lets you access additional credit on better terms. In short, it gives you negotiating power when applying for a loan.
4. Maintaining a Healthy Credit Profile: Regularly checking your credit score can help you maintain a healthy credit profile and a clean credit history. Since a credit score is a numerical summary of the information found in your credit report, a good score usually validates your credit behaviour, whereas, a low credit score tells you that you need to rectify your credit behaviour before exposing yourself to more credit.
Important Note: Checking your credit score or credit report regularly does not lower your credit score at all. You can check your credit score for free at Paisabazaar.com and it will not damage your credit score in any way.
Q1. Can checking one’s credit score lead to a fall in the credit score?
No. Checking one’s own credit score is a soft inquiry and does not affect your credit score. Only hard inquiries for your report when made by prospective when you apply for new credit impacts your credit score.
Q2. How frequently should I check my credit score?
It is completely up to you. However, a monthly review should be sufficient enough to keep you informed about any changes that might creep into your credit report and affect your credit score. You can check your credit score for free with monthly updates on Paisabazaar.com.
Q3. What are the key components of a credit report?
The key components that make up a credit report are:
- Personal information
- Contact information
- Employment information
- Account information
- Enquiry information
Q4. How can I check my credit score?
You can apply for your credit report and credit score by visiting the website of any of the four credit information companies in India- CIBIL, Equifax, Experian or CRIF Highmark. You can get your credit report and credit score completely free of cost through the Paisabazaar website. Click here.