CIBIL score and Credit card settlement to get Home loan

POSTED BY ronak shah ON October 1, 2012 6:37 pm COMMENTS (48)

I had 2 credit cards which I settled in 2008. The latest CIBIL report displays ‘ WRITTEN OFF’ and SETTLED” against each cards.After how many years is the negative record in CIBIL gets removed? This barred me from getting home loan, from LIC, credit cards from other banks till date. At this juncture I AM IN NEED OF A HOME loan. How did I get a loan?  How do I improve my CIBIL SCORE.? and will there be a TIME when the negative marking like” written off” and so on will be removed from my CIBIL account?

Is there any bank which can still give me Home loan desipte my CIBIL record?


48 replies on this article “CIBIL score and Credit card settlement to get Home loan”

  1. Deep says:

    I would like to check with you, i had a auto loan with a bank and due to some unforeseen circumstances i was not able to make regular payments.

    But now i have cleared the the total due amount and some fine for bouncing charges of 22K. But the bank is still demanding a further payment of 29K which is due as fines and other charges.

    The credit report says the following. What should i do, they are asking me to surrender the vehicle and harassing me.

    Cibil Report Says
    Current Balance: 0
    Amount Overdue: 0
    Account Status: Post (WO) Settled

    Can they seize my vehicle

    1. If you have not paid on time, then you need to pay the fines !

  2. MANOHAR AL says:

    Hi sir,
    This is Manohar, please help me with my query. I had 3credit cards and 2 personal loans. 3 credit cards are closed and 2 personals loans are written off. One is suit filed and written off in those. Now I cleared all but it is suit filed written off for loans. Now I am able to pay loans better.
    1.)So, now how long years it will take for me to get a home loan. And
    2.)Is it a good step to take home loan in CO-Operative banks.
    Pls clear my query. Thanks a lot

  3. chandra prabha says:

    Hello Sir i had Axis Bank Credit card way back in 2009 -10, there was outstanding of Rs.19000, as i didn’t got statement i didn’t pay, later when i applied loan in 2016, i got call form Axis bank and paid full amount of Rs. 53000, in Cibil report it is showing written off. Will this be a problem in getting Personal loan, Home loan and Credit card.

    If yes what is the way forward. Kindly suggest.

    1. Yes, until you pay this, you will not get any loans in future !

  4. vinit says:

    I take a car loan in 2008 my car stoled then my loan due is this effect for home loan in a 2017

    1. Hi vinit

      I am not clear on what is your question. Please repeat it with more clarity


  5. Sumi says:

    Hi, my credit card is witten off in 2012. Now i have applied for a home loan as a co applicant. But the applicant have very good credit recored. Nd my credit score is 661. Is it possible to get this loan. As we have already booked the property.

    Please advise as we dont want to loose this property.

    1. I dont want to give you false hopes, but if you are also one of the applicants , then its not that easy to get a loan unless you have all the remarks in cibil as clean. Score does not matter much as much as the remarks !


  6. Raj ella says:


    I have recently settled oct 2016 my sbi credit card which I got NOC also..and currently running 2 Personal loans successfully without any issues..if I am eligible for home loan?

    1. Its only the bank which can decide if you are eligible or not . I can only say that given your situation, its not favourable to get the loan

  7. Kamalakar says:

    Not getting home line because my friend used my credit card and didn’t pay cash …..
    And we want to take a home lone we are not able to get it because of CIBIL score how to solve this problem….

    1. Sorry , but you need to talk to the lender and resolve the problems at their end !

  8. Wilson says:

    Dear Sir,

    I am repeatedly asking SBI Card to make my settlement , but they are saying that the card has not yet completed 9 months.
    I want to settle the amount in good faith, and arrive at a mutual concensus. But they are not ready to listen,
    What should I do.

    Kindly guide

    1. The settlement can happen only if SBI is ready to settle.

  9. Ricky says:

    Dear Sir,

    I’ve 3 credit cards and 2 PL and for that I’m paying clearly. But out of 3 credit card I’ve settled 1 credit card one months back. Can I get home loan ?

    1. Very tough .. your CIBIL report would be surely messed up . You are going to have a tough time getting home loan !

  10. pradeep says:

    Hi Team,

    I am going to settle My SBI card amount which was due as they charged 9000 of interest when i was out of india.

    Also I am planing to take home loan from some other bank in coming months.

    Will this settle amount hurt my dream for Homeloan.

    1. I hope you are paying the FULL amount due. If you were outside India, it does not mean that credit card company will not charge you penalty or dues if any. Its valid and hence you should full pay it . I dont suggest paying anything partially.

      Take NOC once you make full payment


  11. omkar says:

    Hi Manish
    my SBi card limit is 131000 and now its over due is 149000, if i make settlement then am i applicable to take loan in next 6 months.

    if not pls help me what to do

    1. Jagoinvestor Admin says:

      Hi omkar

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  12. Abhijit says:

    Hi Manish,

    What if there is a default in credit card for one of the banks, and that default record does not show up in CIBIL?
    Do I still need to worry?
    I had a card with SBI way back in 2005 but they have charged me with high interest rate and late charges and have subsequently bloated the total outstanding by 9 times. However, this record does not reflect in CIBIL.

    1. If its not in your CIBIL report, you never know when it might start appearing ! .. .so better deal with it anyways even if its not there in CIBIL . Dont take chances !

  13. DHANANJAY says:


    Manish sir please suggest my name is Dhananjay kumar jha

    i used credit card of axis bank 2013-2015 but total amount of 8200 its setteled 4200 in 2015 and right now my score is 738 but i apply for new credit card but its rejected so plaese help me sir


    Dhananjay kumar jha


    1. DHANANJAY says:

      Dear Sir

      Please Reply me

      1. You should check with your credit card company and pay the full amount . Only then your score will get better

  14. Rahul says:

    Hello Manish

    I am trapped in situation where I am willing to settle the SBI credit card but they are asking me to pay big amount.
    I closed SBI with settlement option where I paid amount suggested by them. But now it is showing s Post(WO) settlement. I contacted SBI but they are saying I need to Pay Rs45000 but not able to give me any statement.
    I need to know how they are reaching to figure Rs45000 but they have no answer but wants me to pay that amount.

    Please suggest

    1. Well , if they cant explain it , then they cant get the money. BUt I think the amount would be valid as late charges and interest adds up and a small outstanding can become a big amount .

      My suggestion is to not leave this issue as it is and finalize on something atleast!

  15. Ramon says:

    I im a defaulter in 2 credit cards citi bank and hsbc from last 3 year the mount still same ,wht can I do now can I settle or have to pay full amount
    As I need a home loan in dis year
    Or I can pay in emi the full amount
    Plz help any1

    1. Hi Ramon

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


    2. Kailash says:

      hi Ramon,

      You can opt to pay the total outstanding in EMI’s.
      But, don’t go for settlement, you wont get home loan ever, if you opt for settlement, Pay the total amount, and ask you BANK to provide a NOC. or even you can ask your bank to write an email, that if you pay the complete amount , they will issue an NOC. after 45 to 60 days, your score will get improved.

  16. Manjunath says:

    I have 2 credit cards. i have not made any payments from past 6 mnths due my prsnl reason. Now citibank asking me to pay 40% of total amount to settle that credit card balance. They offering me that they will update in CIBIL saying that Crad is Settled. Will it worthy to settle the payment with citi bank or will it affect me in future for getting any loan. I checked that my CIBIl score is 510 now. I am on confuse state. Can anyone help me out pls. what step i have to take next that does not affect my future CIBIL.

    1. If they are going to mark it as “settled” then its not good.

    2. Sajid says:

      If they mark it as “Settled” it will remain on your Cibil report for upto 7 years. This means you may not be eligible for further loans for 7 years. On the other hand, if you do not pay off your balance, it will keep on reducing your credit score. My suggestion will be to check with your bank if they can offer easy monthly payment and pay off the balance in full rather than going for settlement. This will not only help you in building credit but also maximise your opportunity of getting loan in future.

  17. SRINIVAS says:

    I took Credit card from HDFC bank and too a loan amount of 25,000. Later my outstanding amount was around 35,000 and it was settled to 15,000 in 2011. Now I applied for Credit card again to the same bank and it has been rejected.
    Now I want to know the thing is,
    1) Can i apply for Credit card to other bank?
    2) Will applying for Credit card to the same bank leads to increase the level of difficulty in getting the Cr.Card or loan to be approved?
    3) How shall I get rid of this issue?

    1. You will find it tough because the settlement part would have got recorded in the CIBIL report. I suggest you take a credit card against a FD

  18. Himanshu Bedi says:

    Hi Guys,
    My response might be late but i had been in a similar situation in the past but some how managed to get the loan. Due to recession i had to settle all the Credit cards and Personal loans, however i continued with 1 credit card and 1 personal loan as it was linked through my salary account. I had no choice but to continue with that. Over a period of time ( i.e. less than 2 years ) i continued to pay the EMI on personal loan and used to pay the minimum amount on Credit card as well.
    In 2012 i thought of buying a new car for myself, but the loan application was rejected from all the Leading private banks and even SBI rejected it. Then i approached a GOVT bank with which i had a savings account. And initially only I informed them about my CIBIL score and settlements which i made. The branch manager agreed to process the loan application basis i get all the required No Due certificates from the settled banks.
    As it is a mutually agreed amount between you and the bank none of the banks opposed it and mailed me the No Due certificates. With help of which i successfully got the car loan for 5 Lacs.
    I made it a point not to default any payment on the Car Loan and on my excsiting credit card. Post this i was approved for another private bank card which i rejected later as i just wanted to check whether or not i would be eligible for that. My CIBIL score was 740 when i applied for car loan and today it is 790. All i would suggest is if possible pay of the entire amount and you can even do that today and bank would automatically change the status from settled to closed.
    Hope it was helpful to few 🙂

  19. anurag3003 says:

    Could you please share the outstanding and settlement amount for credit card.

    You can get Home loan from SBI or any other bank even if you have settled the credit card and your CIBIL report says “Written off-Settled”, You need to get the No due certificate from the respective bank where you made the settlement for credit card and submit it to the bank from where you are applying for home loan.

    1. ronak shah says:

      thank you for your comments and I will keep them in mind. Now I bother you with 1 more query. That is, whether any COOPERATIVE BANK (SAHKARI BANK) is under CIBIL. That is whether they check the CIBIL record while approving or processing a home loan.

      1. ashalanshu says:

        Dear Ronak, Co-operative banks may or may not opt for CIBIL. It’s upto individual bank to decide to part of CIBIL.



    2. Majestic Eagle says:


      My question is : When there is a settlement on credit card how can a bank will issue a No Due Certificate ? As per my knowledge, a bank issues a Settlement Certificate and a No Due Certificate is issued on closure after making full payment.

      1. Bala says:

        If you settled the Credit Card you can get the No Due Certificate with Settled Status…mentioned in it.

  20. ConsumerCredit Expert says:

    Hi Ronak,

    Since the write-off/charge-off happened almost 4 years a go, your CIBIL score will ignore it and you will get a higher score. However, the written-off/settled flag will be there on CIBIL report for long. CIBIL is yet to create a policy to remove “derogatory” items from its credit report.

    In advanced economies like US, these sorts of information stays on the file for 5 years (for bankruptcy it is 9 years). So you will have to live with the write-off event for at least 5 years.

    Only good news is that the CIBIL score will ignore this information and you will get a decent score.

  21. lame investor says:

    The bank you have taken the credit card from stands a chance for changing the information. Contact the credit card bank, settle it with them and ask for change in your cibil report.

    I had a mistake in my cibil report due to which i was rejected credit card for 3 years, then cibil started having the quick online facility so i found out the reason.
    Contacted the bank, escalated to the highest level and got the credit score settled. I did get a creditcard thereafter.

  22. You are in a tough situation and the rescue for you is far far away ! ..

    Your CIBIL status for SETTLED and WRITTEN OFF might stay for very very long time, may be 15-20 yrs also . I was talking to CIBIL top management one day on phone and they shared with me that there is no MAXIMUM time line when it will be removed from the report . However the minimum is 7 yrs , but the maximum is not yet decided and might stay for 10-15-20 yrs also .

    So dont depend on the hopes you have about “removal” . The only option for you in short to medium term is to pay off the outstanding which you were suppose to pay and get rid of the statusus . I dont see any solution for getting home loan in next 6 months to 1 yr


    1. ronak shah says:

      Thank for your kind reply…

      1) Means I have to pay remaining amount after settlement?
      2) Even after that any chance that I can improve my CIBIL score as you said take one secure credit card against FD and then use it for 6 month or 1 year?

    2. narifahad says:

      Hello Manish

      I am in a similar situation where my I settled a credit card of mine with IndusInd bank last year and my CIBIL report says “POST (WO) SETTLED”. I had difficulties getting a personal loan last year but HDFC did grant it as my CIBIL score was 694 and they reviewed the track record of car loan. Recently i applied for a credit card and it got rejected for the same reason as i have a “settlement” in my credit history.

      As you have mentioned the only option is to the bank, pay the remaining and close it out and ask them to change the cibil status. I would like to know if am willing to payup the remaining will bank agree to remove the settled status from my CIBIL report and has anyone done this in the past successfully with any bank?

      1. balamurugan says:

        Get the mail or writter n confirmation from the concerned bank and paid the remaining amount , Moreover get the NOC from the Bank after the balance amount paid .In NOC should not mention Settled status . After 45-60 days of your payment, take the latest CIBIL Report and check…

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