Do you know that just like you used to get a report card in school to mark your academic performance in a given period, you similarly get a report card based on your financial performance? We are talking about your credit report. Every individual who has a credit history, i.e., who has taken loans, credit cards, etc, gets a credit report. This credit report is based on a lot of different parameters that are judged. For instance, how regularly you pay your dues, your payment of EMI bills, your credit utilisation ratio, how many times you have enquired for credit, your credit mix, etc. Wondering who assesses all this to create your credit report? In India, four Credit Information Companies (CICs) or Credit Bureaus work to create your credit report. These four bureaus are TransUnion CIBIL, Experian, Equifax and CRIF Highmark. A credit report is also often called a CIBIL report.

Zet App Download from PlayStore

Importance of Having a Good Credit Report

It is crucial that you try your best to have a good credit report and a high CIBIL score. The CIBIL score is three-digit between 300 and 900 and part of the credit report. Let us see why it is of such importance to maintain a good and healthy credit report:

1. It Reflects Your Creditworthiness: A credit report aims to tell lenders how worthy of credit an individual is. In other words, a credit report shows how well or how poorly a person has handled credit in the past - did he make repayments on time, was he highly dependent on credit, how much of the total available credit he used, etc. This is why the credit report is accessed by banks and other lenders whenever an individual applies for a loan or even for a credit card.

Financial institutions gauge the risk of default payments involved in lending you their money. If you have a good credit report and a high CIBIL score, you will find yourselves eligible to apply for credit at most financial institutions.

2. Lower Than Usual Interest Rates: A good credit report builds a lot of trust within a lender regarding your capacity to repay the credit amount. The more trust the lenders have in a borrower, the more they will be willing to lower the interest rates. This is extremely desirable for the borrower because it will make it very easy on his pocket to repay the amount.

3. Higher Amount of Loan: This is an obvious one. As mentioned earlier, a good credit report builds the lender's trust in you. Since they feel that there is a reduced risk of you not paying them back, they readily approve larger amounts of loan. This is great for the borrower as it dramatically increases their spending capacity.

4. Better Credit Card Terms: A good credit report comes in handy even when you apply for a credit card. It decides your eligibility and lets you avail exclusive offers, discounts and rewards on your purchases. An excellent credit report will also get you a higher credit limit itself. Better Insurance Premiums: Many insurance companies consider credit history when determining premiums. A good credit report can result in lower premiums on auto, health, and home insurance policies, as insurers view individuals with good credit as less risky.

Read More:: Is 776 a Good CIBIL Score?

Written-off Meaning in CIBIl?

Now that you are aware of the importance of having a good credit report, you must make it a habit to check yours regularly. This is imperative so that you can stay updated and take the necessary steps to make any improvements that are needed. One thing that reflects extremely poorly on your credit report and that also lowers your credit score is having "written-off" appear on it. Let us understand what "written-off" means, why and when it can appear on your credit report and how it can impact you:

How to Change and Remove Written-Off Meaning and Status

If you see "written-off" appear on your credit report, it means that you have failed to make a payment against a loan or a credit card for more than three months, and the specific lender has given up on recovering the amount. So, they write it off, accepting it as a loss.

Once the lender reports the amount as "Written-off" to the credit bureau, it will be reflected as such on your credit report. This is one of the worst things to have on your credit report because it lowers your credit score and makes you less trustworthy for all lenders in the future.

Having "written-off" on your credit report would have unfavourable implications for you, such as you will find it extremely challenging to be considered for loans and credit cards in the future. Therefore, you must take proper measures to ensure that "written-off" does not appear on your credit report. However, if you have been unable to pay your dues against some outstanding credit and the lender has written it off, you must immediately rectify and remove it from your report. Here is how you can do it:

Step 1: Review Your CIBIL Report

The first thing that you need to do is get your CIBIL report. You can do this easily by visiting the official CIBIL website. Once you have your credit report, identify any accounts that are labelled as "written-off". These are the accounts wherein the lender has given up on receiving their money back from you.

Step 2: Ensure That It Is Not a Discrepancy

It is a possibility that some error has occurred, and the account is wrongly marked as "written off". If this is the case, contact your lender at the earliest so that the mistake can be rectified.

Step 3: Repay the Entire Amount

Suppose the "written-off" status is not the result of an error or a discrepancy, and it is there because of your inability to pay the outstanding amount. In that case, you must now pay the entire amount as soon as possible to get rid of the "written-off" status. We emphasise " entire" because this includes not only the principal loan amount but also all of the accrued interest and any extra charges that might have been levied. This is crucial for getting back to a good credit report and CIBIL score.

Read More:: Is 772 a Good CIBIL Score?

Step 4: Ask for a No Dues Certificate

Once you have successfully paid the outstanding amount, request your lender provide you with a No Dues certificate. This is basically evidence that you have paid the outstanding dues.

Step 5: Request the Lender to Report This to CIBIL

Your main concern is that your credit report must not suffer because of the "written-off" status. But even after you complete the repayment process, the status of your report is still the same. What you need to do is request your lender to provide the updated information to CIBIL. Once your lender lets CIBIL know that you have successfully paid your outstanding dues, CIBIL will remove the "written-off" status from your credit report.

Step 6: Confirm if the "Written-off" Status is Removed From Your Report

Once the lender has reported the update to CIBIL, ensure you access your CIBIL report again after some time. You need to do this to ensure that the status of your credit report has changed.

Step 7: Contact CIBIL For Dispute Resolution

Suppose your credit report still reflects "written-off" even after you have repaid the entire amount and your lender has reported it to CIBIL. In that case, you must contact CIBIL and raise a dispute to resolve the issue immediately.

Read More:: What is Experian Credit Score and How It Affects You

Conclusion

To enjoy a good and convenient banking experience and find yourself eligible for loans and credit cards, you must have a wonderful credit report tos how. A good credit report and a high credit score reflect your creditworthiness to the lenders and increase their trust in you. Make sure that you regularly check your credit report and instantly identify if a "written-off" status is being reflected under any account. This would mean that you have failed to pay your outstanding dues for more than three months, and the lender has given up on getting the repayment. They report the amount as "written-off" to CIBIL. This reflects very poorly on your credit report, and you must take immediate measures to change this "written-off."

status. First and foremost, make sure that it is not an error. If it is, reach out to your lender to resolve the mistake. If it is not, repay the entire amount as soon as possible and obtain a No Dues certificate from your lender. Also, request them to report the successful repayment to CIBIL so that they can change the status pof your credit report.

Once all this is done, review your credit report after a few days to make sure that the desired change is being reflected and the "Written-off" status has been removed. If you find that it is still being flashed under the account, you can raise a complaint with CIBIL and request the earliest possible resolution of this problem. Written-off status is very harmful for your credit report and you must take instant action to get rid of it.

Frequently Asked Questions (FAQs)

1. Is it bad if I have a "written-off" on my credit report?

Yes. It is bad and extremely undesirable to have " written-off" being reflected in your credit report. This is a sign that you have been unable to pay your dues for over three months. This will reduce your credit score and make you less reliable in front of banks and lenders. They will trust you less, and you will find it extremely challenging, if not impossible, to obtain more credit (loans and credit cards) in the future. In short, "written off" on a credit report reduces your creditworthiness.

2. How can I avoid getting "written off" on my credit report?

The best way to avoid the written-off status on your credit report is to obviously be punctual with repaying all your outstanding dues. Be it a loan or even a credit card, make repayments on time. A great way to keep track is to regularly check your credit report.

3. Will written-off affect my CIBIL score?

Yes. If your credit report shows written-off status, it will adversely affect your CIBIL score. Your CIBIL score will decrease significantly. Making repayments on time is one of the biggest factors that are considered while calculating an individual's CIBIL score.

4. How can my bank remove the written-off from my report?

In order to get rid of the written-off status from your credit report, you first need to repay the entire amount that you owe. This includes the principal loan amount, accumulated interest, and any charges that might have been levied on you. Once done, obtain a no dues certificate from your bank and request them to report the successful repayment to CIBIL. Once CIBIL receives this update from your bank, they will remove the written-off from your credit report.

5. Is debt settlement a good option to get rid of written-off from my credit report?

Debt settlement refers to an agreement between a borrower and a lender on an amount that is less than the total outstanding amount owed by the borrower. While this will help you remove "written-off" from your credit report, it is not a good option because it affects your credit score adversely and further affects your creditworthiness.

6. Can I get a loan if I have written on my credit report?

If you have written off on your credit report, then it is highly unlikely that you will get a new loan. This is because lenders will find it difficult to trust your repayment capacity because of your long outstanding dues.