Bad debts will directly affect users’ applications for credit cards or loans at banks.

Once there are bad debts in the credit report, especially bad debts caused by overdue, it is more serious than ordinary overdue records. With such bad debt records, it is basically impossible to apply for credit cards and loans. It is difficult to eliminate bad debt records in credit reports. Generally, overdue records will only be retained for 5 years after repayment.

The bad debts in the credit report will not be eliminated on a rolling basis. As long as the user does not deal with them in time, the bad debt records will remain in the credit report. Sometimes even if bad debts are paid off, bad debt records often remain for a long time because the credit system is not updated in real time. If there is a record of bad debts on your credit report, it means that the debt has been overdue for a long time and you may be considered a bad debtor.

Classification of bad debts:

1. General bad debts

General bad debts mean that the borrower fails to repay the loan in time, and the number of overdue days exceeds 180 days, and collection efforts are unsuccessful. or situations where the lender is unable to contact the borrower.

2. Overpayment and bad debt

Overpayment and bad debt refer to the excess amount after repaying all the credit card payments.

3. Bad debts due to annual fees

If users who hold credit cards have idle credit cards and have not canceled their accounts, resulting in unpaid annual fees, bad debts will occur.