What is a ‘Settled’ Loan Account?
A ‘Settled’ status on your credit report indicates that a loan or credit account was closed after you paid less than the full amount owed. Such status can negatively impact your creditworthiness. To remove this status, it is essential to clear any outstanding balances with the concerned lender. In cases where the ‘Settled’ status is incorrectly reflected, you can raise a dispute with the credit bureau to rectify the information.
Is it Possible to Remove Settled Accounts from CIBIL Reports?
Yes, it is possible to remove settled accounts from credit reports. However, the only way to do so is to clear the outstanding balance amount and obtain a no-objection certificate from your lender. Once submitted to the credit bureau, they will update your loan status from ‘Settled’ to ‘Closed’.
Steps to Remove Settled Account from Your Credit Report
Sometimes, your CIBIL report may show ‘Settled’ even when you have never settled an account. In this case, you can request the bureau to remove the ‘Settled’ status by raising a dispute. Follow these steps to have the settled account removed from your CIBIL report:
1. Go to the official website of CIBIL and log in to your account with your credentials. If you do not have an account, create one to file a dispute.
2. Select the account with the incorrect settled status and attach the supporting documents if required.
3. Provide accurate details regarding the dispute and submit the request.
CIBIL will verify your claim, which may take up to 30 days.
Also Read: Why is Credit Report Important?
What is the Meaning of ‘Written Off' Status in CIBIL?
The ‘Written Off’ status visible in the CIBIL report signifies that the borrower has not been able to make payments against their outstanding loan. This status may have implications on the borrower’s overall credit score. Since credit score is a pivotal factor in determining the creditworthiness of a borrower, a lower credit score due to the ‘Written Off’ status in the CIBIL report may affect their eligibility for loans in future.
A "Settled" status remains on your CIBIL report for up to seven years from the date of settlement. This can negatively impact your credit score and reduce the chances of loan approvals during this period.
Yes, it is possible to remove the settled account from your credit report. You can pay the balance loan amount and obtain an NOC or No Objection Certificate from the lender. In case the account has been settled incorrectly, you can raise a dispute with the respective bureau and get it resolved.
