Will educational loan settlement affect CIBIL Score and blacklist acc

POSTED BY C R Manikandan ON April 17, 2012 1:51 pm COMMENTS (4)

My friend has been told settling his educational loan wont affect his CIBIL score nor add him to blacklist – He got 5 lakh loan from bank of maharastra , bank agent has asked settlement 3.5 lakhs
between he is paying EMI’s regularly

4 replies on this article “Will educational loan settlement affect CIBIL Score and blacklist acc”

  1. If its “settlement” , means instead of paying 5 lacs , just pay 3.5 lacs and close this chapter, then this will be a very negative thing and will be updated in CIBIL as “Settled” , and will be there for atleast 7 yrs .

    So dont go for settlement if asked.

  2. C R Manikandan says:

    Thanks BanyanFA & ashal jauhari 🙂

    it seems he couldn’t pay his due for last 2 months due to marriage and this agent has contacted him for his settlement for 3.5 lakh

  3. Dear Manikandan, is it loan settlement or loan prepayment? From your query it seems it’s loan prepayment & your friend wants to preclosure of the loan. If my understanding is correct, it’s actually a good thing for the CIBIL score.

    I agree with dear BanyanFA, that your friend should deal directly with the bank no matter it’s preclosure or settlement.

    Thanks

    Ashal

  4. BanyanFA says:

    Hi Mr. Manikandan,
    Just a small query, why is an agent involved in the middle. I would strongly recommend to deal directly with the bank, just in case there are no prepayment penalties to settle the loan.

    Prepayments are not going to affect your CIBIL score. On the contrary, it may reflect good on your credit history showing that the person has been responsible enough to pay back the credit facility taken by him.

    Regards
    BFA

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