How To Remove Your Name From The Credit Defaulter List

You applied for a Personal Loan and your lending bank denied the loan stating that you are not eligible. Reason: poor Credit Score. Not a good situation to be in if you really need that loan.

There are several factors that affect a Credit Score – delay in paying EMIs, missed Credit Card payments, or pending loans are some of these. All of this could put on the credit defaulter list which is definitely not a good thing.

In case this has happened to you, we’ll tell you how to get it off, but before we do that, let’s understand what a Credit Score is and why your name gets on to the defaulter list.

What is Credit Score?

A Credit Score is compiled by credit bureaus based on your credit and repayment history. They collect information of every individual in the country from different banks and assign them a score. For instance, a CIBIL Score ranges from three hundred to nine hundred. A score close to 900 makes you highly eligible for Loans and Credit Cards, while anything close to 300, puts you in the defaulter bucket. In addition to CIBIL, there are other credit agencies like Equifax and Experian which also collect this information.

Why does your name appear on the defaulter list?

Let’s use a CIBIL report as an example. Once you download a copy of your CIBIL report from the official CIBIL website and find your name on the defaulter list, you will need to find out why you’re your name got there. Here are a few reasons why your name appears on the list:

• Human Error: Your name, gender, PAN details, address or any of the details could have been entered in the wrong format. So, once you download the CIBIL report, check if all the information is correct.
• Loan default: You haven’t paid your loan or Credit Card EMIs on time. No brainer here, your name is going to features in the defaulter list.
• Incorrect Reporting: Your payment details towards your Loan or Credit Card may not have been uploaded properly by your lending bank.

Additional Reading: Credit Score vs Credit Remarks: Which Matters More?

What to do if your name appears in the defaulter list?

If your name appears in the defaulter list due to human error (from CIBIL authorities), you can simply report the case to CIBIL.  You need to provide them with valid documents regarding the incorrect detail and it will be rectified.

If your name appears in the defaulter list due to loan or payment default, then you need to clear all the pending EMI payments at the earliest. The CIBIL authorities generally publish a monthly report, so make sure you clear your pending dues by then. Wait for a month to get the report updated after you make the payments and your name will not appear in the CIBIL defaulter list.

In case your name is on the defaulter list due to an issue from your lending bank, visit the nearest bank branch at the earliest and report the error. Get an acknowledgment copy of your payments from the bank and forward the same to CIBIL. Once CIBIL verifies the credit file with your bank, your name will be removed from the defaulter list!

Remember, a bad Credit Score will lower your chances of applying for loans and Credit Cards. So, try and sort out the matter at the earliest with the tips we just gave you and your name will soon be off the defaulter list!

Meanwhile, you can also learn about ways to improve your Credit Score.