How to apply for a credit card if you have a bad credit?

bad credit

I paid two installments of a loan late and the Bank flagged me in the credit card Information Systems as a bad payer. A few months ago I asked for financing but the Bank replied that it could not accept my request. Can you explain to me what it means? Are there other ways to apply for funding?

It is first necessary to clarify who and when one becomes a bad payer. For Banks and financial institutions, the bad payer is the one who defaults on contractual obligations – or in other words – the one who does not pay or pay late. This situation legitimizes credit institutions (Banks) to report the subject – bad payer – to specific “information systems on the credit position of customers who use credit”, to be clear, the black lists in which the subjects whose financial reliability are included is not guaranteed.

In Italy, these systems are managed, on the one hand by the Bank of Italy, which has its own central risk office (CR) and on the other hand by Credit Information SystemsReporting to these lists as bad payers actually entails exclusion from the credit market for the reported debtor and, therefore, the bad payer cannot ask (or has considerable difficulties!), For a given period, for loansfinancing. , mortgages and may not have a credit card or checkbook.

The functioning of the Credit Information Systems is governed by the Code of ethics and good conduct for information systems managed by private entities in terms of consumer credit, reliability, and punctuality in payments.

Procedure for reporting a Bad Payer

The procedure that the credit institution must follow, in the case of a first report, and the time spent in the registers are regulated within the code of ethics. The reporting to the Credit Information Systems takes place, as already mentioned when the delay in payment of the installment extends for more than two consecutive months(or for two installments paid late). The Bank is required, fifteen days before the transmission of the data to the registers, to notify the Client and give him the last chance to regularize the debt position before the notification becomes effective. After the first warning is made to the Customer, if the payments are again late, the Bank can request the notification in the registers without any kind of warning. The above regulation also establishes the maximum retention times for data in the databases of the Credit Information Systems:  Credit applications. Once transmitted to the Credit Information Systems, they are visible for six months (one month in case of refusal or waiver of the loan).

Arrears of two installments (or months) then settled. The information is kept for twelve months from the date of regularization.

Arrears of more than two installments (or months) then remedied. They are visible for twenty-four months from the date of regularization.

Arrears were never remedied. They remain visible for thirty-six months from the contractual expiry or from the last update.

Positive information (which indicates, that is, full compliance with the loan repayment plan). They remain visible for thirty-six months from the termination of the relationship or from the expiry of the contract or from the first update of the month following those dates.

Upon expiry of the maximum retention times for negative data, the Credit Information Systems must proceed with the automatic deletion of the data. Each citizen has the right to have free access to their personal data contained in their database in the manner indicated on the respective websites. In the event that an undue report is made for payments already made, not due or, the procedure described above is not respected, it is possible to take legal action and obtain compensation for the damage, also assuming responsibility for the entity. However, there are forms of financing for the “bad payer” (the same applies to protesters and foreclosures) through the assignment of the fifth or delegation of payment. This possibility is open to employees hired for an indefinite period or retired.

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By Michael Caine

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