Debt counselling: Sanjay Agarwal

One of my relatives had an accident. When he was hospitalised, I did not have enough cash to pay off the hospital bills. So, I used my credit card. Since he was still recovering, he was unable to pay back. In the meantime, my credit card bill came. The bill amount was quite high, and I was unable to pay the entire sum. I don’t want this single event to affect my credit history. If I explain my situation to the bank, will it ensure that this default is not reported to Cibil?
Credit history available with credit bureaus reflects the repayment behavior of a borrower. So, your default will be reported to Cibil. However, as a default is reflected in the report generated, subsequent repayment and regularisation also mirror. You must not bother yourself with the reporting, as bankers see the overall repayment trend. Clear this default as early as possible.

My wife and I separated three months back. Recently, I found that the three add-on cards with her were totally maxed out. While I have requested the bank to discontinue these, I have defaulted due to lack of knowledge. Now my banks’ records state I defaulted on the payments of my credit card bills for the last two months. The banks want me to settle the bills soon. I am also planning to apply for a home loan. Will this affect my loan-taking ability?
You need to speak with the manager concerned of your bank, with a proof of your instructions to discontinue the cards on a particular date. If you do not have such proof, you may ask the bank to furnish the same. If the matter is not resolved, approach the nodal officer of the bank. All communications should be in writing to keep an official record. If the problem is still not resolved, contact the banking ombudsman of RBI.

Regarding your home loan, while the Cibil report is considered for a loan sanction, it is not the only deciding factor. If you explain your problem to the approving bank and show them a copy of the communication made, they are sure to take this into account.

The writer is senior vice president & group head (retail strategy & branding), Arcil. Send your queries to yourmoney@bsmail.com