Understanding & Improving Your Credit Score

What is a Credit Score?

A credit score is a three-digit number ranging from 300 to 900 that reflects your creditworthiness. It’s calculated by credit bureaus such as CIBIL, Experian, Equifax, and CRIF based on your credit and repayment history. A score above 750 is considered good and improves your chances of securing loans at favorable terms.

Why is it Important?

  • Determines loan eligibility and approval speed
  • Affects the interest rate you’re offered
  • Impacts access to credit cards, insurance, and even rental agreements
  • A healthy score builds trust with lenders and can unlock better financial products

How is Your Score Calculated?

  • Repayment History (35%): Timely EMI and credit card payments
  • Credit Utilization (30%): Percentage of used credit vs. available credit
  • Length of Credit History (15%): How long you’ve had credit lines
  • Types of Credit (10%): A balanced mix of secured and unsecured loans
  • New Credit Enquiries (10%): Too many loan applications can pull down your score

Tips to Improve Your Credit Score

  • Pay EMIs and credit card dues on or before the due date
  • Keep credit card usage below 30% of the limit
  • Don’t close old credit accounts (older accounts improve credit age)
  • Avoid applying for multiple loans or credit cards at once
  • Check your credit report every quarter for errors or fraud
  • Use secured credit cards or credit builder loans if your score is low
  • Monitor co-signed and joint loans — their delays affect your score

Common Mistakes to Avoid

  • Settling loans partially — it reflects as \"settled\", not \"closed\" and hurts your score
  • Ignoring small dues like credit card minimum payments
  • Using only short-term credit facilities like Buy Now Pay Later (BNPL)
  • Frequent hard inquiries from multiple lenders in a short time

Frequently Asked Questions

  • Does checking my credit score reduce it? No, soft checks don't impact your score.
  • Can my score vary across bureaus? Yes, each bureau uses its own scoring model.
  • How often should I check my score? At least once every 3-4 months.

Need Help with Credit Repair or Funding?

SolveDet helps individuals and businesses improve credit scores, settle defaults, and apply for fresh funding. Reach out to our experts for personalized support.