default on credit history and british citizenship application

Hi all.
I hope you are all fine and I appreciate your help.
I was a co-personal guarantor for a business loan. we were 2 directors of that business but after I resigned, the other person stopped paying the loan and contacting the bank. Long story short, the bank contacted me and put pressure on me for payment.
I arrange a payment plan and monthly I was paying the amount agreed. No court orders nothing involved!
now, out of blue I have been notified that as the time has passed from the loan and it has not been cleared yet, the bank has decided to write off the loan but will mark it as default in my credit report!
as this loan was a business loan, it is not shown under my name in clear score report.
Now, I don't know if it will be shown under my name as default? where can I check the full comprehensive report?
secondly, I am applying for my British citizenship in 6 months. does having a default on credit report will affect my application?? I have about £k10 personal loan that I am paying under the terms of contract and no credit card debt.
I highly appreciate your help.

Could you please help me? I am so anxious.

First, get a copy of your credit report. Google "credit report" to find reputable companies that can provide one. Then you will know what your precise situation is, in detail, and we can discuss it further here if you wish.

Thank you.
The bank still hasn't defaulted my account. I was thinking some contingency plan and seeking advice about its consequences on my BC application.

Perhaps start with searching for "free credit report" - that's the statutory report the credit agencies need to provide by law so you know what's on there. Don't pay for anything. In general debt is not a problem as long as you comply with the arrangements to repay/clear, and can demonstrate this by providing documents.