# Ways to Improve Credit Score Before Applying for Personal Loan
Modern lenders put a high deal of emphasis on the credit score of the borrowers before any loan application. Hence, you need to conduct a [credit score check](https://www.muthootfinance.com/cibil-credit-score) ahead of applying for a loan, including personal loans. These loans can be used to fund home renovations, medical emergencies, family weddings, dream holidays, education of children and more.

To improve your odds of getting a personal loan shortly, as well as securing reasonable interest rates, you should have a good CIBIL score. CIBIL is one of the leading credit rating agencies in India. Financial institutions and banks widely use the CIBIL credit score as a reference point for evaluating the creditworthiness of borrowers. Credit score or CIBIL score is the indicator of the creditworthiness of a person, or their ability to repay loans.

You should try to improve your credit score before applying for a [personal loan](https://www.muthootfinance.com/personal-loan). There are multiple ways of doing so, including:

## Do not Forget your Payment Deadlines
Late EMI or credit card payments can hurt your credit score. Hence, it is better that you set reminders a couple of days before due dates. You may also opt for automatic payment options, where the amount to be paid is automatically deducted from your bank account. Following such a method would help make sure that you never miss your payment deadlines. Even a single late payment may lower your credit score, and eventually make it harder to get a personal loan application approved.
### Use Credit Prudently
You should avoid taking on too much debt at once. The number of loans you apply for during a certain time period should be limited. To make sure that your credit score does not dip too low, you should try to repay one loan and then take another. When you successfully repay a loan, your credit score gets a boost.
### Diversify Credit Types
Having a good mix of varying types of credit can improve your CIBIL score to a good extent and elevate your overall financial health. This can include personal loans, car loans, home loans, and even credit cards. Having a diverse credit portfolio would indicate that you can responsibly handle varying types of credit. A diverse mix of credit types can help boost your creditworthiness in the eyes of lenders. However, you must remember that every line of credit should come with careful consideration of your ability to repay the loan. Taking on multiple types of credit and properly managing them shall demonstrate to lenders that you are a responsible borrower, which would invariably help improve your CIBIL score.
### Monitor your CIBIL Score
You should try your best to regularly monitor and review your CIBIL score and report to check for any inconsistencies. There can be certain situations where CIBIL makes mistakes in updating your records, incorporates incorrect information against your report and ultimately delays in recording details. At times a loan that you have already repaid may not have been updated on the credit report, as a result, your credit score would be lower than it should be. If you observe such errors, then you must get them rectified instantly.
If you have a low CIBIL score for personal loan approval, then following the steps mentioned above would be a good way to improve your credit score. If your credit score is above 750, banks and other financial institutions would perceive you as a low-risk applicant. Hence, they shall approve your personal loan application easily. Personal loan interest rates available to you are also likely to be lower if you have a good credit score.