Reviewing your credit report regularly helps avoid any set back to your
financial goals. To understand this better, let us consider a case:
Rajiv Khanna had been saving for five years to buy an apartment. He was overjoyed
when he found his dream home. However, Rajiv was in for a shock when he
approached a housing finance company for a home loan. His loan application had
been declined because as per his credit report he had an outstanding of Rs 23,000
with a credit card company, overdue for 2 years.
Rajiv was taken by surprise as he had been paying his credit card dues on time, ever
since he had taken the card, 10 years ago. Clearly, there was some mistake in his
credit report.
Rajiv immediately applied for a copy of his credit report from the Credit Bureau.
Reviewing his credit report helped him identify the problem. He had applied for a
credit card three years ago. Though the salesman had assured him that it was a
lifetime-free card, an annual fee had been charged in the first statement itself.
On contacting the bank, he was told that the fee could not be waived. He informed
the bank that he was not interested in the credit card, and personally delivered the
cancellation letter along with the credit card (cut into two pieces) to the bank. Since
he did not receive any further statement from the bank, he assumed that the matter
was over.
However, his credit report showed that the original fee (on the credit card) of around
Rs 1,000 had grown to Rs 23,000. The credit card that he had forgotten about was
coming in the way of purchasing his dream home.
Does this scenario seem familiar? What should be done in a situation like this?
First and foremost get a copy of your credit report and review it. On identifying any
error, the same needs to be reported to the Credit Bureau. It is advisable to also call
up the concerned lending institution and send a mail to the grievance redressal
officer. As per the Credit Information Act, you should get a response within 30 days
of your communication to the grievance redressal officer. On receiving the response,
the same should be sent across to the credit bureau for rectification. In the event of
not receiving a response or not receiving a satisfactory resolution from the lending
institution, the issue may be escalated to the Banking Ombudsman (BO), appointed
by the Reserve Bank of India. If the resolution provided by the Banking Ombudsman
is not satisfactory, you can appeal to the Deputy Governor of the RBI. A borrower
has the right to move the matter to a consumer court in case he is not satisfied even
after the intervention of the RBI.
So what finally happened in Rajiv’s case? He sent a strong complaint letter to the
bank, and after some follow-ups managed to get the error rectified in the credit
bureau’s report. With his credit history clear, he finally managed to get his loan
approved.
To avoid getting into such a situation, review your credit report regularly. This helps
in not just maintaining good credit health, but also in identifying any errors at an early
stage and taking corrective action.
Credit Triangle is a one-stop solution for all your credit and finance needs. We help
you with credit health management, repair, and improvement.