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How to Change the Written-Off Status & Clean CIBIL Record?

To develop a healthy CIBIL record, it is crucial to understand all of its associated elements and terms. A CIBIL report contains details of an individual's credit history such as the number of accounts, name of the lender, loan amount, as well as the payment history. If you have ever read your CIBIL report, you might have come across the term "Written-off". This term is detrimental to the health of your CIBIL score, as it means that the borrower was unable to pay their dues on a given loan or line of credit, and the lender had to ‘write-off’ the loan amount. However, what if we told you that you can get this ‘written-off’ tag expunged to avoid further damage to your CIBIL record and credit score.

How to Clear “Written-off” Status from Your CIBIL Report?

Having a clean CIBIL report is vital to secure new or additional credit. However, there may be times when the report may have some errors due to poor financial management, incorrect information, fraudulent usage, etc. Hence, it is advisable to do a CIBIL report check, i.e. credit score check, once in six months to stay updated. If you have the ‘written-off’ tag marked on a loan/credit account on your CIBIL report, you first need to check whether it is correct. In some cases, a ‘closed’ account can be marked as ‘written-off’ if updated incorrectly. Such errors need to be rectified as soon as possible by filing a dispute online with TransUnion CIBIL.

How to Raise a Dispute via CIBIL's Dispute Resolution Process?

The following are the steps to file a dispute on CIBIL:

Step 1:

Go to www.cibil.com, and create an account. If you already have one, simply sign in.

Step 2:

Select the ‘Credit Reports’ option and click on ‘Dispute Centre’ before selecting ‘Dispute an Item’.

Step 3:

Fill in the online CIBIL dispute form and choose the relevant section.

Step 4:

Select the ‘Dispute Type’, enter a value if you are disputing data inaccuracies, and click on ‘Submit’.

Once the CIBIL dispute form is submitted, TransUnion CIBIL will verify the information with the relevant lender, and the status will most likely be updated within a month.

How to Improve Your CIBIL Record?

An individual with a good CIBIL record is viewed as someone who is disciplined with their payments, i.e. credit-worthy. Payment defaults and delays can harm your credit score. Hence, it is crucial to make your payments on time to maintain a good score and a healthy credit history. You can cut down on unnecessary expenses and save up money for debt repayment or even take financial help from your friends and relatives to pay the outstanding dues. With regular repayment of your debts, your CIBIL record will gradually improve.

What is Debt Settlement?

Debt settlement is a type of agreement made between the lender and the borrower that makes it easier for the latter to clear their dues. Typically, the lender might reduce the debt by providing a concession on the interest payable. The debt settlement amount and process is based on the type of credit that was availed. Once the agreed amount is paid, the lender would mark the account as "Settled" in the CIBIL report. While settlements also reflect poorly on your credit score, it is better off than the ‘written-off’ status.

How Would Lenders Treat You After a Debt Settlement?

Post debt settlement, lenders might be hesitant to offer you unsecured loans as you were unable to pay your previous dues in full. However, there are chances of availing a secured loan by pledging an asset as security with the lender. Also, note that a secured loan can raise your CIBIL score faster if you make timely repayments. You also get access to additional benefits like easy loan approval, lower rates, minimal paperwork, etc.

How To Remove “Settled” Status from Your CIBIL Report?

To clear the “Settled” status from your CIBIL report, you need to pay the outstanding amount on your loan and get a NOC (No Objection Certificate) from the lender. The next step is to raise a dispute on the CIBIL website. The credit bureau will confirm the update with the lending institution and change the status from “settled” to “closed” within 30 days.

Parameters That Determine Your CIBIL Score Post Debt Settlement

There are certain parameters that CIBIL uses to assign credit scores. These parameters are crucial in rebuilding your credit history in the most desired way. They are as follows:

Credit Aspects

Weightage

Credit repayment history

35%

Loan amount the borrower owes

30%

Number of years servicing the debt

15%

Total number of loans availed or applied for

10%

Credit mix

10%

Understanding the elements of your CIBIL record and working on them will help you build your credit information report. It is crucial to have a clean CIBIL report or you might have a tough time availing a loan or line of credit in the future. A score of 750 and above is excellent and gives you the power to negotiate the terms of the loan with the lender. Check your CIBIL report and CIBIL scores every six months to understand your financial standing. You can get a free CIBIL score check online and a Financial Health Check Report (FCHR) using the Finserv MARKETS app to get more insight into your finances.

If you have a healthy CIBIL record, you can easily avail an instant loan online with any financial institution. At Finserv MARKETS, you can avail a high loan amount of up to Rs. 25 Lakhs through the Bajaj Finance Personal Loan with interest rates starting from as low as 12.99% per annum. If you meet the loan eligibility criteria, the online loan process becomes even easier and the loan amount gets disbursed within 24 hours post loan application approval. Visit Finserv MARKETS, now!

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FAQs

  • ✔️How to Remove Written Off Status from Your CIBIL Report?

    You can start paying off the settlement amount to remove the written-off status on your report and obtain an NOC (No Objection Certificate) from the lender, stating that you don’t owe anything to them. Ask the lender to submit the NOC to CIBIL, on updation of the report the written-off status will be removed.

  • ✔️How to Delete Old Data from Your CIBIL Report?

    One cannot delete or edit data directly in a CIBIL report. However, you can take the help of a credit repair company and get your credit information. The company will send you a report on your provided email address or home address.

  • ✔️How to Remove Your Name from CIBIL Settlement?

    Request the lender for an extension of your loan tenure to avoid falling under the defaulter’s list. If the lender has filed a lawsuit against your name, you can request your lender for an out-of-court settlement. If the lender agrees to the settlement and the case can be withdrawn.

  • ✔️Does Written Off Affect Your Credit?

    Yes, if a credit card company writes off your debt, it will be displayed as a charge-off on your report. This  mark on your CIBIL report can have a negative effect on your score.

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