How Can I Rebuild My Creditworthiness After Financial Struggles?

[doesntmatter]

I lost my job last year and faced severe financial challenges. To make ends meet, I had to utilize 103% of my credit card limit, rely on pay-later services like Mobikwik, and take small personal loans from apps like KreditBee. This took a huge toll on my credit profile, leaving me with a high inquiry ratio, closed accounts, and a significantly impacted CIBIL score. However, I’ve been working hard to fix things, and my score has started to improve. I’ve cleared most of my dues and am maintaining timely payments. My current challenge is rebuilding my creditworthiness to regain access to better credit options. Given my history, I’m wondering what type of credit cards I might be eligible for. Should I go for a secured credit card backed by a fixed deposit, or are there low-limit beginner-friendly cards that would suit my profile? I want to rebuild my credit responsibly without falling back into financial trouble. Any advice or insights on which credit cards I should apply for, how to approach banks or NBFCs, and other steps I can take to further improve my creditworthiness would be greatly appreciated!

 

[NAB]

Let it grow organically.
Try to keep debt ratio as low as possible. Timely Payments will help boosting of score again.

Apply only for the pre-approved card (so, very low chances of the rejection
), Don't go after multiple cards. It will increase more enquiries and credit score will suffer. Use cards wisely, and let the time do his work.

Best of luck!!

 

[RAMESH BABU N]

First, really glad to see you comeout of your financial troubles... Congrats dear. And, glad to see your resolve to stay out of such debt traps....

For a few months, stay out of unsecured credit cards.

Take a RuPay credit card - secured one - like Super.Money App. Easy to get reward card n fully functional.

For few months, DO NOT get more cards. Getting a card nowadays is very very easy. Avoid them all. Having more cards, means trying to do wasteful and avoidable expenditure by going after spending milestones n rewards n cashbacks.

Strict Financial Discipline n Frugal Living. This is critical when you are REBUILDING.

Forget about what others had or buying or spending.

Focus on your goal. Keep me posted your successful efforts n positive outcomes. I love to hear about young, resolved n successful guys like you. You become better than you were earlier and a role model for many others.

Best of luck n blessings from my side.

 

[dvader]

First, really glad to see you comeout of your financial troubles... Congrats dear. And, glad to see your resolve to stay out of such debt traps....

For a few months, stay out of unsecured credit cards.

Take a RuPay credit card - secured one - like Super.Money App. Easy to get reward card n fully functional.

For few months, DO NOT get more cards. Getting a card nowadays is very very easy. Avoid them all. Having more cards, means trying to do wasteful and avoidable expenditure by going after spending milestones n rewards n cashbacks.

Strict Financial Discipline n Frugal Living. This is critical when you are REBUILDING.

Forget about what others had or buying or spending.

Focus on your goal. Keep me posted your successful efforts n positive outcomes. I love to hear about young, resolved n successful guys like you. You become better than you were earlier and a role model for many others.

Best of luck n blessings from my side.

@OP This is solid advice. One of my friends was in a similar situation and the only CCs he got during a two-year period were all secured (three to be exact). Two of them with minimum limits (5000) and the last one as a main CC (50000 Limit). Helped him a lot.

 

[Zacobite]

I lost my job last year and faced severe financial challenges. To make ends meet, I had to utilize 103% of my credit card limit, rely on pay-later services like Mobikwik, and take small personal loans from apps like KreditBee. This took a huge toll on my credit profile, leaving me with a high inquiry ratio, closed accounts, and a significantly impacted CIBIL score. However, I’ve been working hard to fix things, and my score has started to improve. I’ve cleared most of my dues and am maintaining timely payments. My current challenge is rebuilding my creditworthiness to regain access to better credit options. Given my history, I’m wondering what type of credit cards I might be eligible for. Should I go for a secured credit card backed by a fixed deposit, or are there low-limit beginner-friendly cards that would suit my profile? I want to rebuild my credit responsibly without falling back into financial trouble. Any advice or insights on which credit cards I should apply for, how to approach banks or NBFCs, and other steps I can take to further improve my creditworthiness would be greatly appreciated!

pls don't apply anywhere / or take any CC for next 9-12 months.. go slow... dont over engineer the situation..continue in your current model for 1 yr.. let CCs come to you..

 

[magnusfan]

Excellent advice above. Just to add, don’t overthink it. Be content with a frugal life and shift the fun from spending to investing! For me, this mindset shift was a crucial factor in realizing that money attracts more money, and once it starts multiplying, all credit scores naturally improve.

Happy Investing!

 

[sidp]

. Should I go for a secured credit card backed by a fixed deposit, or are there low-limit beginner-friendly cards that would suit my profile? I want to rebuild my credit responsibly without falling back into financial trouble.

Glad to see the turn around brother. My advice will be little different.

1. Do you have a rupay cc? If not, try to convert one of your cc to rupay. Use it for day to day expenses. Keep your expenses to bare min.

2. Pay the min amount everywhere and pay up highest rate loan 1st.

3. If you have closed all cc, you can take fd backed cc like super money. But this should depend on how much money you have for fd and your outstanding debt. If your saving is a significant part portion of outstanding debt, they keep 15-20k and pay up the rest.

4. Avoid using social media/going out as much as possible.

 

[sidp]

. Should I go for a secured credit card backed by a fixed deposit, or are there low-limit beginner-friendly cards that would suit my profile? I want to rebuild my credit responsibly without falling back into financial trouble.

Glad to see the turn around brother. My advice will be little different.

1. Do you have a rupay cc? If not, try to convert one of your cc to rupay. Use it for day to day expenses. Keep your expenses to bare min.

2. Pay the min amount everywhere and pay up highest rate loan 1st.

3. If you have closed all cc, you can take fd backed cc like super money. But this should depend on how much money you have for fd and your outstanding debt. If your saving is a significant part portion of outstanding debt, they keep 15-20k and pay up the rest.

4. Avoid using social media/going out as much as possible.

 

[Vasuki]

I lost my job last year and faced severe financial challenges. To make ends meet, I had to utilize 103% of my credit card limit, rely on pay-later services like Mobikwik, and take small personal loans from apps like KreditBee. This took a huge toll on my credit profile, leaving me with a high inquiry ratio, closed accounts, and a significantly impacted CIBIL score. However, I’ve been working hard to fix things, and my score has started to improve. I’ve cleared most of my dues and am maintaining timely payments. My current challenge is rebuilding my creditworthiness to regain access to better credit options. Given my history, I’m wondering what type of credit cards I might be eligible for. Should I go for a secured credit card backed by a fixed deposit, or are there low-limit beginner-friendly cards that would suit my profile? I want to rebuild my credit responsibly without falling back into financial trouble. Any advice or insights on which credit cards I should apply for, how to approach banks or NBFCs, and other steps I can take to further improve my creditworthiness would be greatly appreciated!

Just like banks
There is no advice for you
Unless u share specifics of how u messed up cibil
Yes you took loan then
Is there settlement
How many late payment

What do u mean by high enquiry ratio

Finance works with number
Provide that either in Dm or here for better & consise advise just for you

Else everything is hitting in dark kinda situation

 

[ARV]

I was in a similar situation about 10 years back.

My suggestion is to focus on increasing your income first and then thinking of all the other things. Credit cards will eventually come to you after your income increases.

To repair the CIBIL,

1. Focused on increasing the income to pay off the outstanding debt
2. I closed all the loans and payed the credit cards in full (not settlement but full payment) and closed them
3. I took Kotak 811 card with FD backed (1L), kept the utilisation under 20% and on time full payment, no minimum due
4. Applied for unsecured loan and card after a couple of years (Shows that you are not credit hungry)

All the best and hopefully you are in the right track