Bad debts, simply put, mean that there are some unprocessed funds in the cardholder's credit card account, and they continue to be in an unprocessed state. After this state exceeds a certain period of time, the bank will list it as bad debts.

There are generally two reasons for the formation of bad debts:

① Overpayment is the bad debt caused by overpayment. When the credit card repayment date is reached, some people are afraid that the repayment limit will be insufficient and the payment will be overdue, so they will pay more money. For example, the bill that should be paid in the bill month is 500 yuan, but they end up paying 600 yuan, so the extra 100 yuan belongs to Overpayment. We can withdraw the overpayment in cash or swipe the card for consumption. However, if the credit card does not consume for a long time after repayment, the overpayment of 100 yuan will always be displayed in the bank. After a certain period of time, the overpayment will become into bad debts. But such bad debts have no impact on consumers.

②Bad debts caused by overdue credit cards. The bad debts we see on credit reports are basically caused by overdue credit cards. When a credit card becomes overdue, the bank will adopt different collection methods at different stages. Within one month of overdue, the bank will mainly send text message notifications. If it is overdue for one to three months, it will conduct telephone collection and door-to-door collection. If it is overdue for more than three months, the bank will issue a collection call. You may receive a court summons from the bank, and the bank will also entrust a third-party collection agency to collect the money. If the bank does not collect the debt, and the debt is overdue for more than one year, it may be listed as a bad debt by the bank, because the bank will write off credit cards that cannot be repaid for more than one year, and then cancel the payment. A portion of the current period's profits will be used to offset these bad debts.

The status of being listed as bad debt will always be displayed in the credit report. Bad debt is more serious than overdue. When applying for a loan or credit card, once there is a bad debt status on the personal credit report, it is impossible to obtain it. The bad debts caused by overdue loans and credit card applications can be understood as "blacklists within blacklists". After a bad debt occurs, if the amount is too low, the bank has basically given up on collection, and will not sue the debtor to court. There is a cost for a bank to sue a debtor to court. It has to pay litigation fees and attorney fees. If the bank takes the debtor to court and the debtor is still unable to repay, the bank will have to pay for the litigation fees and attorney fees. That's not worth the loss. Therefore, if the overdue amount of the debtor is small, the bank will generally not sue the debtor to the court. If the money is still not recovered after one year of collection, the bank will generally include the money as bad debts for review. If the credit card is cancelled, the credit card status of the corresponding debtor will become bad debt.

The bank sets the status of the debtor's credit card to bad debt. If you do not pay off the principal and interest, the bad debt status will always exist. At present, the maximum retention time of personal credit report information in our country is 5 years. The key point is that these 5 years are based on the prerequisite of good credit. If the personal credit is in bad condition, such as bad debts, overdue debts, and the money has not been settled, no matter how much it is, This state will continue to exist after years and will not be eliminated automatically. Therefore, when bad debts arise, everyone should actively deal with them and pay off the debts in a timely manner.