In India, a good credit score is the gateway to loans, credit cards, and all other financial products. If lenders have lost faith in recovering dues from a borrower for several months, such accounts are reported to CIBIL as “written-off.” A lot of people don’t know what this means or how to clear Written-off in CIBIL. Well, here is a step-by step guide on how to clear Written-off in CIBIL, why it happens, and the best remedial steps to safeguard and better position one’s financial health, in just a few words.
❖ What is Written-Off in CIBIL
When a borrower stops repaying for any loan or credit card dues for along time, the bank or lender finally loses hope in getting back the due amounts (Principal & interest) and declares such an accounts under the classification “written-off.” The whole scenario is reported into CIBIL and other credit bureaus.
❖ Effects of Written-Off Status
Written-off in CIBIL can drastically affect your CIBIL score, as the presence of that remark plays an important role in the rejection of new credit facilities & financial products. Also, it gives rise to a negative impression on how you are going to repay in the future. Thus, if you want your financial status to be repaired, you have to clear the written-off status from CIBIL.
❖How to clear Written-off in CIBIL
There are several ways to clear Written-off in CIBIL report. If the credit facility belongs to you and there is a Written-off mentioned in that account. Then, the best process (Step-by step guide) to clear Written-off in CIBIL is discussed below.
1. Check Your CIBIL Report
– Access your CIBIL Report from the official website (https://www.cibil.com).
– Mark which accounts are mentioned as written off.
– Note down the lender’s name, sanctioned date, sanctioned amounts, outstanding amount, and date of reporting.
2. Talk to the Lender
– Contact the bank or financial institution directly (through branch or trough online portals).
– Do the proper enquiry about the pending dues and the payment options that can be availed.
– Be friendly and discuss with them about the procedure of how to clear the entire due amounts.
3. Pay the Entire Due Amounts to the Financial Institution
– The ideal situation would be to pay the outstanding amount in full.
– If that is not achievable, request them for a time period. So that you can pay the dues throughout a specific term.
– Never agree to a compromised settlement, as Settlement will definitely close that account, but it will never be a solution.
4. Get a No Dues Certificate
– A No Dues Certificate or a Loan Closure Letter is to be requested once the amount is repaid.
– This document acts as proof that you have completed the loan closure procedure properly.
5. Update Your CIBIL Report
– The lender has the obligation to clear Written-off in CIBIL mentioned in that loan account or credit card account.
– If the CIBIL is not updated, lodge a dispute on the CIBIL website with proper evidence to clear Written-off in CIBIL.
– Normally, to clear Written-off in CIBIL takesa time of approximately 30 – 45 days, but several factors that influences the time it takes.
❖ Some Useful Tips to Clear Written-off in CIBIL
Keep Documents: Secure all payment receipts, settlement letters, and certificates. – Don’t use third party: Deal directly with the bank so that fraudulent activities are avoided. – Patience: Changes in the CIBIL report can take some time. – Build New Credit: Small loans or the proper use of credit cards would retain you in good stead while rebuilding your score after clearing dues.
❖ An Illustrative Example
For instance, Mr. Sharma has an outstanding credit card bill of ₹50,000, which fails to pay because of loss of job. After two years, the bank marked his credit card account as “Written-off.” When he got a job, he approached the bank, which informed him about the entire due amount as ₹30,000.
Mr. Sharma paid that amount and got a No Dues Certificate. His CIBIL report was updated within the updation time frame, raising his score and thus qualifying for a personal loan.
❖ Why You Should Clear Written-off in CIBIL
– It proves that you are responsible and committed to trusting lenders with the fact that you are ready to make up for past mistakes.
– It can put you in a whole new financial world.
– It brings less anxiety and helps you think of future achievements like buying a house or a car.
❖ Conclusion
Clear Written-off from CIBIL, by bearing the total responsibility for the entire due amount and getting the dues paid to the lender, the substance being really showing the genuine intent. Once dues are settled and the report updated, making an effort to rebuild of credit score can thereafter be embarked on. Financial discipline is the cornerstone of a healthy credit history. If anyone follows these steps, anyone can clear Written-off in CIBIL. Just follow these steps and build a bright financial future.
