It is not just accessing the funds that matter. You must also consider a few aspects before making the personal loan a weapon to improve the score.

• Do not apply for several loans

Do not become hungry for credit when representing your needs in front of the lender. Moreover, every time you seek a loan, the lender initiates a hard enquiry on your credit report, which again impacts the credit score. With too many hard enquiries, you are going to lose your prospects as a borrower.

• Choosing the amount wisely

You may take personal loan to meet your needs any time but make sure the need is genuine. When you take a loan to improve the credit score, the amount itself can play an important role. Try to assess your needs carefully before choosing the amount wisely.

• Paying the amount regularly

Availing a personal loan for improving the credit score does not make any sense if you fail to pay the EMI regularly. Whether it is personal loan or credit card, both are unsecured loan options, so you have to make it a habit to make the monthly payments within the schedule.

• Pre-paying the loan

When you avail the amount to improve your credit history, you must stay away from the option of pre-closing the loan as longer credit history is viewed positively by the lenders. Therefore, if you continue to make the payments within time, a longer tenure reflects on the credit score positively it provides you with an opportunity to improve the score.

• Closing the loan before tenure

Often people try to close the loan before the tenure to avoid the high rates of interest but do not forget that the lender considers the long and short-term creditworthiness. Even when you have the money to end the debt before the tenure, you must pay bulk amount instead of closing it prematurely especially when you have availed the amount to boost the credit score.