Are you getting married? Three ways to check the credit mantras of your groom

Marriage is seen as a sacred vow in the Indian society, where a girl leaves her family and enters with the groom's life. Before taking this big decision, every girl and her family keeps an eye on how much worthy the groom is financially. It is a common practice since the bride's family wants a stable household for her. There common parameters that are checked are if the groom has a house, how much he earns, does he have any pending loans along with the the behaviour and upbringing of the groom. These checks bring satisfaction for parents who are giving away their daughters.

They also allow the parents to understand the financial goals and planning of the groom like when does he plan to buy his own house or car. It’s no mystery that everyone wants to buy a house of their own! Hence, for brides it becomes very important to be aware of the groom’s capability and creditworthiness for financial assistance ahead. 

Even for the bride, it is improtant to know that the groom has the above credit mantras right. 

Ranjit Punja, CEO and Co-Founder of CreditMantri explained three factors. Firstly, In what ways can a groom's creditworthiness be checked beforehand itself? Secondly, what are the ideal parameters that need to be considered in a groom's creditworthiness and lastly, bank balances can be faked during a wedding, but credit score will reflect the creditworthiness of the groom.

Let’s find out! 

Groom's creditworthiness! 

Traditionally, Indian families check their children’s prospective partner’s employment details, salary, bank balance etc. through complex and vague ways so as to gauge their creditworthiness. But, it is not always fool proof. A credit score provides a much more comprehensive view of an individual’s credit history, is easier to access and is consistent. 

Still a relatively novel concept, it has reduced the efforts made by the families substantially. It demonstrates how responsible an individual is with regards to managing money and should the situation arise, how much chance they have to get a loan during a financial crunch.

It can also make a delicate topic for both parties much more easy to navigate since sharing credit score does not require an individual to divulge specific details. It’s a very safe process and easy way to avoid any sort of surprise later.

Ideal parameters needs to be considered! 

An ideal credit score should be above 750. This not only deems an individual as a creditworthy and responsible person, but also gives them a negotiating power with the lenders. To get to this position, they must repay all their credit dues on time without any delay. Keeping track of all the dues is tricky and if there are multiple lines of credit opened, debt consolidation could come in handy.

Also, they should have a balanced credit mix of both secured and unsecured credit. Availing just personal loans or credit cards could hamper their credit score. If they have a credit card, then their credit utilization ratio should be maximum 40% of the limit. Lastly, they should have certain lines of credit aging at least a few years. If they fall under the ideal range of all these parameters, they can definitely be considered as creditworthy.

Credit score! 

Credit Score is the reflection of all the credit activities of a person. Since banks directly share the information of their customers with Credit Bureaus, who subsequently determine their Credit Score, there could not be a more secure option of gauging one’s creditworthiness than Credit Score. 

Hence, Credit Score is always on spot while determining a person’s creditworthiness as it is safe in the hands of Credit Bureaus and is immune to any kind of tampering.

Punja added, "The details of one’s repayment history, credit mix, and credit utilization ratio is kept secure with the bureaus and even if other details are falsely shared by an individual, Credit Score would always reflect the true creditworthiness of them."