What Is DPD?
When you request a loan or a credit card, the institution reviews your credit history to determine the value of your credit. Thus your CIBIL credit report is produced by organisations like CIBIL. Applicants with a sound credit report and high CIBIL score are more likely to receive loans and often at a relatively smaller interest rate.
By visiting the CIBIL TransUnion website, an applicant can produce his credit report and can know the CIBIL score. A comprehensive credit report and the CIBIL score will be given to the applicant. A segment called the CIBIL DPD is available in the study (Days Past Due). For the approval of the loan, the CIBIL report and credit score are required. However, when it comes to institutional loan approval, DPD plays an important role.
What Is Days Past Due In A Cibil Report?
The financial habit of a loan borrower is suggested by Day Past Due or DPD. It indicates that the applicant does not pay EMI for a certain month for several months. For every credit he has taken from the sector, the applicant will obtain a separate DPD. This could include personal loans, home loans, college loans, and so on. For each loan, the entity that grants the borrower the loan is created a DPD, which is given to the CIBIL.
For example, if an applicant has 3 different loans, including a home loan, a car loan and an education loan, three different DPD reports will be reported on the applicant's CIBIL report. For a term of three years, DPD is valid for all credit accounts. The creditor sends the EMI timely payment or failure report to CIBIL every month. The creditor If you default for an EMI for one month, you must wait for your visible DPD records three or 36 months. But the buyer should always pay off EMIs without default, as a small error will cost you tremendously over the next few years.
Format Of DPD Value
There is a section in each CIBIL report which shows the DPD record for the applicant. In the following format, the CIBIL DPD report is displayed:
- 000: The value 000 indicates that for the month of January 2017 the applicant has cleared all of his duties. It indicates that duties were resolved at that time and that no loan for the month was outstanding. This is the safest and strongest condition. If the value of DPD is 000 per month, then the applicant's finances are very strong and lenders will easily pay loans because they're the least risky deals for loans. Although the borrower has a relatively lower loan score but a great DPD study, it is easy for lenders to punish loans.
- XXX: This value is seen in the report when CIBIL TransUnion is not provided with the report by the lender. This value does not influence the applicant and in this case it is deemed secure. XXX indicates, in this case, that the bank has not provided CIBIL with the February 2017 results.
- 30, 60 or 90: A number in the report by the DPD shows that, at the time of payment by the EMI, the candidate has refused to pay the EMI sum until the day referred to. Whether 30 or 90 would adversely affect the credit report and ultimately the credit score. This means that the creditworthiness of the applicant is poor.
Where the applicant fails to pay the first month, the DPD report states 30 as can be seen in the March 2017 report. If EMI payments cannot be made for 2 months, 60 of them are listed as shown for April 2017 in his DPD report. And if someone cannot make payments on time, financial experts recommend that they must ensure that they do not refuse to repay longer than 90 days.
Other Reported DPD Values
Some lenders record these values in various forms according to RBI asset clarity requirements. Values for DPD are: STD, SUB, DBT and LSS under these conditions. Let us talk in depth about each value:
- STD: This is known as the regular payment, meaning the payment took 90 days. Paid within 90 days shall be deemed non-performing assets (NPA).
- SUB: It indicates that payments are not made under normal and that up to 12 months have not been compensated. However, it is likely that funds will be recovered. These borrower investments are considered risky.
- DBT: It states that for more than 12 months, the applicant has made no EMI payments. However, reimbursements of the creditor are also likely to occur. These candidates are viewed as very risky, and most banks tend not to allow their applications for loans.
- LSS: On DPD records the account for which the bank loses all expectations of repayment is labelled LSS. The balance was not collectible for that account. In the future, these borrowers will rarely obtain loans from the DPD study of LSS.
How To Change DPD Values In Cibil Report
Since DPD values are added per month and no more than 36 such values are indicated on the report, there is a slight error in payments for 36 months. In the DPD report there is no way to adjust values. If you fail to pay in a month then try to clear things up and make payments punctual for the next 36 terms as soon as possible. After 36 such payments, your report will be clean. Banks take into account all borrowers who have failed to pay once or twice, but who otherwise pay off their debts regularly. However, for those applicants whose LSS credit report was listed in DPD it is most difficult to get loans accepted.