Credit card NPA

Dear Client,
Under the RBI’s prudential norms, a credit-card account can be classified as NPA when the Minimum Amount Due remains unpaid for more than 90 days from the payment due date. Since you have stated that you have been unable to pay even the minimum amount for approximately three months, your credit-card account may be approaching or may already have crossed the NPA threshold, depending upon the exact due dates.
However, the important issue is that RBI norms generally provide for borrower-wise rather than facility-wise asset classification. The RBI framework states that where a borrower has more than one credit facility with the same bank, the facilities may have to be treated in accordance with the borrower-wise NPA principle, rather than treating only the particular facility that became irregular. Therefore, there is a genuine risk that an HDFC credit-card NPA can have consequences for your HDFC home-loan account as well, notwithstanding the fact that your home-loan EMI is being regularly paid. That said, the exact treatment of your home loan depends upon how HDFC has structured and classified the facilities, the terms of your loan documents, and the bank's application of the prevailing RBI norms.

In your particular case, one favourable factor is that the home-loan EMI is being paid regularly and there is no default in the home-loan repayment itself. The fact that the EMI is being paid from your wife's bank account does not, by itself, cure or create a default; what matters for the home-loan account is whether the instalments due under the home-loan agreement are being paid on time. Therefore, you should not stop the home-loan EMI under any circumstances merely because of the credit-card problem. Maintaining the home loan as regular is extremely important because the home loan is secured by the property.

There is also a separate issue of credit reporting and recovery. Once the credit-card account becomes seriously overdue/NPA, HDFC can report the relevant delinquency to the credit information companies, which can adversely affect your CIBIL/credit profile. This may make obtaining further credit, restructuring, refinancing or other banking facilities more difficult. The credit-card outstanding of approximately ₹1.5 lakh also remains independently recoverable by HDFC, and the bank can take contractual/legal recovery measures even though your home-loan EMI continues to be paid.
do not allow the situation to continue without approaching HDFC. Since your home loan is only around ₹6 lakh and is being serviced regularly, your immediate objective should be to protect the home-loan account from becoming irregular while negotiating a settlement/restructuring/repayment arrangement for the ₹1.5 lakh credit-card liability. You should approach HDFC in writing and request a repayment arrangement or conversion of the credit-card outstanding into a manageable EMI/loan facility, if eligible. Do not make an unaffordable commitment merely to prevent NPA classification; first obtain the exact outstanding, overdue amount, days-past-due status and the options HDFC is willing to provide in writing.