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What is Written Off in CIBIL report

A Written off in your cibil credit report occurs when a loan becomes non-performing due to repayment difficulties. Written off in a credit report means that the loan or card is long due and bank have marked the said loan or credit card as a Non Performing Asset (NPA). When a lender writes off a loan, it means they’ve assessed the debt as unrecoverable and have taken it off their books for accounting purposes. It doesn’t necessarily mean the debt is forgiven or erased entirely.

A Written off in your cibil credit report occurs when a loan becomes non-performing due to repayment difficulties. Written off in a credit report means that the loan or card is long due and bank have marked the said loan or credit card as a Non Performing Asset (NPA). When a lender writes off a loan, it means they’ve assessed the debt as unrecoverable and have taken it off their books for accounting purposes. It doesn’t necessarily mean the debt is forgiven or erased entirely.

A CIBIL status of “written off” indicates that the borrower has failed to make payments against their outstanding loan for over three months. When an individual cannot repay their loan, the lender can “write off” the borrowed funds. This status on a CIBIL report can adversely affect an individual’s eligibility for loans in the future.  Lenders often check a person’s credit history when lending. When they come across a CIBIL written off, it indicates that the borrower has been unable to make repayments against their loans and makes them a defaulter candidate. Additionally, it can severely impact the borrower’s credit score and cause it to drop below the desired level.

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What do you mean by a Defaulters list

What do you mean by a Defaulters list

Remember these vital facts: The credit bureaus maintain a list of loan defaulters, Credit bureaus also compile borrowers’ credit details and make them available to lenders to assess their creditworthiness The Reserve Bank of India (RBI) maintains a list of wilful defaulters with a collective outstanding credit amount of more than ₹25 lakhs.

The following practices fall under the wilful default category

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The following practices fall under the wilful default category

Deliberate non-payment of the dues

Siphoning off of the funds 

Misutilisation of proceeds

Misrepresentation of records

Removal of securities without the bank’s knowledge

Fraudulent transactions

Know What and How

If an individual has a bad credit history, their creditworthiness is impacted. Here’s the solution:

  1. Keep track of due dates for EMI and Credit Card Payments.
  2. Monitor your credit score by downloading your credit history report from CIBIL’s website.
  3. Ensure timely payments of EMIs and Credit Card bills.
  4. Communicate with the lending authority to rectify any inaccuracies in your credit report.

       5. Avoid unreasonable debt to meet personal requirements

Issues In Wrritten Off

Written Off

When an account or debt is “written off,” it means that a creditor has officially declared it as unlikely to be collected or paid. This often happens when you have not made payments on a debt for a long period (typically 180 days or more), and the creditor determines it’s no longer worth pursuing. Here’s what it involves

Accounting Term

The creditor removes the unpaid debt from their balance sheet as an asset. Essentially, it’s considered a loss for the business.

Impact on Your Credit

A “written-off” debt can severely damage your credit score. The creditor will likely report it to the credit bureaus, marking it as a charge-off, which stays on your credit report for up to seven years.

Still Owed

Even though the debt is written off, you are still legally obligated to pay it. The creditor may sell the debt to a collection agency, which can continue to try to collect the money from you.

Credit Debt

While “written off” may signal the end of efforts by the original creditor, it doesn’t mean the debt is forgiven, and it can have lasting effects on your credit and financial life

Where will the CIBIL Credit Report be used?

Your CIBIL Credit report or score plays a pivotal role in your financial journey. Your CIBIL score/ credit report acts as the first impression for the lender, the higher the score, the better chances of the loan/credit card being approved. Listed below are some of the ways a good CIBIL score/ credit report can help you.

Credit Report Be Used

Quicker and hassle free approval for loans and credit cards.

Lower interest rates.

Easy approval for rented/leased houses and apartments.

More negotiating power.

Get approved for higher limits.

CIBIL Credit Score Problems and its Solutions

Error in your CIBIL Credit Report- Errors in CIBIL report can be something as minor as a spelling error in your name or address. Though this might seem like a minor error, it can cause damage. The other sort of damage you might incur is from a mistaken identity where you might find someone else’s loan details in your report or an overdue amount on a loan that you haven’t taken. These minor errors will bring down your CIBIL score drastically and might even lead to rejection of your application. 

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