A credit score is a 3-digit number that ranges between 300-900. This is a crucial score that comprises of your payment history, credit inquiries, credit utilization ratio, credit history, etc. It is on the basis of this score that decides the credibility of an individual. A healthy credit score will improve the chances of an individual obtaining a credit card but on the other hand, a low or poor credit score will decrease your chances of getting a credit card. With the help of a good credit score, you can get the best credit cards in the industry with low-interest rates.
Therefore, it should be your prime responsibility to check your credit score on regular basis and get the errors removed, if any, from your credit report. This is because any error in your credit report will lead to a fall in your credit score, which in turn will lower your chances of getting any type of credit, such as a credit card, a loan, etc from financial institutions. Also, there is a notion that checking your credit score regularly will lower it, which isn’t actually true. When you yourself check your credit score, then this is considered a soft inquiry, and a soft inquiry does not lower your credit card. But whenever you apply for a new credit card, the card issuers place a hard inquiry on your credit score, which definitely will impact your credit score in a negative way.
Why Should You Check Your Credit Score Regularly?
In order to maintain your credibility, you should keep a regular check on your credit score. Here, in this article, we will discuss 5 reasons to check your credit score regularly –
To keep your credit report error-free
A credit report is a detailed statement of your credit score. Any kind of error in your credit report will lead to a decline in your credit score. Errors such as spelling mistakes, any error related to your debt repayment, etc can lead to a lowering of your credit score. Therefore, you should keep a regular check on your credit report to keep your report free from such type of mistakes.
Know What type of card you can choose
When you check your credit report, you get to know about the credit score that you possess. On the basis of this score, you can decide on the credit card that you want which is also the one that matches your spending pattern and enhances the value of rewards points that you earn while you make transactions using that particular credit card. For example, the better the credit score you possess, the better the credit card you will get along with greater rewards and benefits as compared to those credit cards that you will get with a relatively lower credit score.
To know your financial situation
Just like health check-ups are mandatory to keep your health in check, similarly, financial checks are also very important to keep your financial health in order. If you have a good credit score, then this means that you are taking good care of your financial health but if you have a low credit score, then this means that there are some issues in your credit report and that you will have to take some necessary steps to overcome such situation.
To always keep your credit score in the green zone
A credit score of 750 and above is considered a good credit score and an individual should try to remain in the green zone if he/she wishes to enjoy the best of everything such as best interest rates, best credit cards, best rewards, and benefits, etc. If your credit score falls in the yellow or red zone, you should take appropriate steps such as rectification of any error that pops up in your credit report, timely payment of your credit card bills, timely payment of other EMI, etc. It takes a lot of time and hard work to rise up the credit score. Therefore, it should be the prime responsibility of credit cardholders to keep a regular check on their credit scores and take appropriate steps to bring their credit score to the green zone.
Protect your credit score from fraud
By keeping a regular check on your credit report, you can notice any new and unfamiliar activity, if any, has taken place. If any fraudster has stolen your identity or details of your credit card, an immediate response from your end will be appreciable. If your credit score drops unexpectedly, check your credit report thoroughly that whether any unexpected loan transaction has taken place in your account. And if such a thing has happened, report the same to your bank or financial institution immediately and ask for a solution immediately.
Read More: How To Fix A Bad Credit Score?
It is important to check your credit score on regular basis to increase your chances of getting approved for a better credit card with low-interest rates. You have to make sure that your credit report is error-free and if there exists any error, proper steps should be taken to remove such errors from your credit report as these errors will do nothing but bring your credit score down. Also, regular checking of your credit report lets you know about your credit situation and lets you know whether you need to take any immediate steps to improve your credit score. Furthermore, keeping a regular check on your credit report also lets you know about any fraudulent transaction that has taken place with your credit card. Therefore, to sum up, credit cardholders should check their credit reports on a regular basis and try to maintain their score above 750 always.