Different Status on CIBIL Report & their Meanings
Santoshh Singh
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Common Status flags that can appear on a CIBIL report.
1. Closed:
It means that you have paid off your loan in full and the bank has reported this account as "Closed" to CIBIL you will find a date adjacent to the 'Closed' field in your account section. After closing a loan, it is important to obtain a No Dues Certificate (NDC) from the bank
2. Settled:
If you have partly paid the dues and settled a loan or credit card then the status will reflect as "Settled" in your credit report.
3. Written Off:
When you are not able to make payments against the outstanding loan/credit card amount for more than 180 days, the lender is required to "write off" the pending amount and this will reflect in your report.
If the CIBIL Report shows a "settled" or "written off" status, then it may get difficult for the individual to obtain a loan.
4. Suit filed Willful defaulter:
According to the RBI, a willful default is one that has occurred in any of the following instances:
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When there is a default in repayment obligations to the lender even when it has the capacity to pay the dues. Basically, the person is deliberately not repaying the loan. The funds have not been used for the purpose for which the loan was taken but have been diverted for other purposes. When the assets bought by the loan amount have been sold off without the knowledge of the bank/lender.
What happens if one is marked as a Wilful Defaulter?
It will choke off most credit channels since no additional lending facility will be available from any bank or institution.
A willful defaulter is not permitted to run any new business for a period of five years from the date of being declared a willful defaulter.
The crazy point is that banks and institutions have been given the right to change the management of willfully defaulting companies, so few companies like to have a willful defaulter on their board.
How does a status go to your CIBIL Report?
Banks & Institutions are required to submit the list of suit-filed accounts of willful defaulters and others at the end of every quarter to the Credit Information Bureau (India) Ltd (CIBIL).
Have you checked your CIBIL report status yet?