For How Many Years Will CIBIL Keep A Record Of Defaulters?

Find out how many years CIBIL will keep a record of defaulters. Get informed about credit score and credit score-related decisions today.

8 Sep,2023 12:49 IST 2723
For How Many Years Will CIBIL Keep A Record Of Defaulters?

Was there a time when you missed an EMI payment on your loan? If yes, this has been recorded by the credit report agencies, which might leave you on the list of defaulters too. Your CIBIL credit score plays a significant role in accessing credit products, and any missed repayments can stay on your credit report for a specific period, impacting your score. Lenders use this information to evaluate your creditworthiness, making it crucial to maintain a clean CIBIL credit report for better financial prospects. So before proceeding with solutions to manage the credit score, let us understand the details about the defaulters' list.

What Is The CIBIL’s Defaulters List?

TransUnion CIBIL maintains the CIBIL Defaulters List; however, it is compiled by the Reserve Bank of India (RBI). In 1997, the RBI mandated financial institutions, banks, and NBFCs to share a list of loan defaulters with outstanding amounts of Rs. 25 Lakh or above. Loan defaulters are classified into two types: non-wilful, facing financial difficulties, and wilful, deliberately not repaying despite having the means. The RBI's list of wilful and non-willful defaulters is available to the public yearly on its official website, and the CIBIL Defaulters List comprises names from the RBI's list. The lenders may find your name on the list if you fail to repay your dues on time.

CIBIL retains an individual's financial history for seven years. Lenders use this information to assess creditworthiness. CIBIL cannot remove names from the defaulter's list, so improving your credit score is important if you find yourself on it.

Affect On Loan Applications:

There isn't a separate CIBIL score defaulter list, as credit rating agencies and CIBIL don't issue one. When applying for credit, lenders request your credit score from the bureau. A poor credit score due to bad repayment history may lead to credit rejection. However, some lenders might still approve loans despite bad CIBIL scores. Factors like a good salary, a spouse with a good credit score, specialized credit bodies, and peer-to-peer lending options can offer alternatives for loan approval, although with higher interest rates and smaller loan amounts.

Can I Remove My Name From The List?

While there is no official CIBIL defaulter list, being marked as one can adversely affect your credit status. To improve CIBIL score and potentially get your name removed, follow these steps:

Review Your Credit Report:

Check for mistakes or inaccuracies and ensure all information is correct and up-to-date.

Clear Outstanding Debts:

Focus on settling all dues to improve your credit report. Communicate with lenders if you face financial constraints to find a feasible solution.

Timely Payments:

Consistently pay loan installments and credit card bills before the due date to maintain a good credit score.

Responsible Credit Utilization:

Keep your credit usage within 30% of the limit to maintain a healthy credit score.

Apply For Loans Wisely:

Avoid multiple loan applications and frequent short-term loans, which may signal credit hunger. Instead, apply for one loan at a time for better chances of approval and smoother repayment.

By following these steps and correcting any inaccuracies in your credit report, you can work towards removing your name from the CIBIL defaulter list and improve your credit status.

How Can I Avoid Being On The CIBIL Defaulter List?

Defaulting on a loan can arise for various reasons, like a medical emergency or job loss. To avoid a suit-filed account and protect your credit, consider extending your loan's tenure or asking for an EMI payment deferral from the bank. Seeking assistance and advice is crucial to prevent worsening the situation and suffering from severe legal consequences affecting your credit score. Taking prompt action and communication with the bank can help navigate these challenging times.

Conclusion:

In conclusion, being aware of the consequences of being listed as a CIBIL defaulter is crucial for financial well-being. There's no need to panic if you find yourself among the listed individuals. Take proactive steps to improve your credit score by checking your credit report regularly, making timely payments, and addressing any outstanding dues. At IIFL Finance, we understand everyone deserves a chance to rebuild their creditworthiness. We offer personalized loan solutions to help you on your journey towards financial recovery. Take a loan with us and ensure timely repayments to enhance your credit score gradually. Let IIFL Finance be your partner in this journey towards a better credit score and greater financial stability.

Disclaimer: The information contained in this post is for general information purposes only. IIFL Finance Limited (including its associates and affiliates) ("the Company") assumes no liability or responsibility for any errors or omissions in the contents of this post and under no circumstances shall the Company be liable for any damage, loss, injury or disappointment etc. suffered by any reader. All information in this post is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results etc. obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. Given the changing nature of laws, rules and regulations, there may be delays, omissions or inaccuracies in the information contained in this post. The information on this post is provided with the understanding that the Company is not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. This post may contain views and opinions which are those of the authors and do not necessarily reflect the official policy or position of any other agency or organization. This post may also contain links to external websites that are not provided or maintained by or in any way affiliated with the Company and the Company does not guarantee the accuracy, relevance, timeliness, or completeness of any information on these external websites. Any/ all (Gold/ Personal/ Business) loan product specifications and information that maybe stated in this post are subject to change from time to time, readers are advised to reach out to the Company for current specifications of the said (Gold/ Personal/ Business) loan.

Most Read

Check the Difference Between 24k and 22k Gold
9 Jan,2024 09:26 IST
50876 Views
Like 6165 6165 Likes
Franking and Stamping: What’s the difference?
14 Aug,2017 03:45 IST
46527 Views
Like 7650 7650 Likes
Why Gold Is Cheaper In Kerala?
15 Feb,2024 09:35 IST
1859 Views
Like 4150 1802 Likes
Personal Loan With Low CIBIL Score
21 Jun,2022 09:38 IST
28802 Views
Like 6437 6437 Likes

Get in Touch

I accept the Terms and Conditions