If you are on a "blacklist" when applying for a home loan or real estate investment financing, passing the screening becomes extremely difficult. It is important to understand how credit information works, how to check it, and how to build an appropriate financing strategy.
What is a blacklist? How personal credit information works
The term "blacklist" is a common expression referring to a situation in which financial incidents such as long-term credit card delinquency, debt restructuring, or personal bankruptcy have been recorded by a personal credit information agency. Financial institutions such as banks conduct loan screening based on this information.
Financial institutions do not maintain a blacklist themselves. Instead, they are members of the three personal credit information agencies, CIC, JICC, and KSC, and obtain information through them.
What happens to a home loan or real estate financing if you are on a blacklist?
If your credit information contains a record of a financial incident, passing screening for a home loan or a real estate investment loan becomes very difficult. As long as the record remains, financing is effectively unavailable, which can have a major impact on real estate acquisition and investment plans.
What causes someone to be placed on a blacklist?
The main causes recorded as financial incidents are as follows.
- Long-term credit card delinquency (more than 2 to 3 months)
- Late loan repayments or nonpayment
- Debt restructuring such as voluntary settlement, personal rehabilitation, or personal bankruptcy
- Unpaid installment charges for a mobile phone (an often overlooked blind spot)
- Inability to repay due to multiple borrowings
People often assume that a small amount is not a problem, but even delinquency on an easy-to-use credit card or mobile phone bill can damage your credit information.
When does credit information recover?
Blacklist records do not remain forever. The time it takes for a record to disappear varies depending on the nature of the incident.
- Credit card delinquency, unpaid mobile phone charges, etc.: about 5 years
- Voluntary settlement, personal rehabilitation, personal bankruptcy: 5 to 10 years
Once the record is deleted, you can be screened in the normal way. If you are considering real estate investment in the future, it is important not to create new damage in your credit information starting now.
3 ways to check your own credit information
By confirming whether incident information exists before applying for financing, you can avoid the risk of leaving unnecessary screening marks. Where you should check depends on the type of financial institution involved in the delinquency (check fee: 1,000 yen for each agency).
CIC (credit cards and various loans)
Credit card companies, finance companies, and banks are members. You can request disclosure online from a PC or smartphone. Obtain a reception number using the phone number used for your credit contract and log in.
JICC (consumer finance)
Consumer finance companies are the main members. You can apply through the dedicated smartphone app, and if you submit images of your identity verification documents, you can receive the result by mail.
KSC (bank loans)
Banks are the main members. Applications are accepted by mail only. Send the disclosure application form, two identity verification documents, and a fixed-amount postal money order for 1,000 yen.
Because information is shared among the three agencies, we recommend checking all of them before planning a real estate acquisition.
Frequently Asked Questions (FAQ)
Q. Can I buy real estate even if I am on a blacklist?
A. A home loan or real estate investment loan is difficult, but a cash purchase or a purchase under a family member's name is possible. However, we recommend planning with future financing in mind after your credit has recovered.
Q. Is there anything I can do while waiting for my credit information to recover?
A. Focusing on asset building that does not damage your credit information, such as iDeCo and NISA, and strengthening your available funds can also work in your favor when you apply for financing after your credit recovers.
Q. Does checking my credit information affect the number of screenings?
A. A self-disclosure request that you make yourself does not affect your credit information. It is different from a credit inquiry conducted by a financial institution.
Q. If a family member has been delinquent, does it affect my screening?
A. As a rule, only the applicant's own credit information is subject to screening. However, if the application involves a joint guarantor or combined income, the other party's credit information will also be checked.
