Will credit card settlement affect CIBIL?

Answer

A:

Yes, settling your credit card dues can affect your CIBIL (credit) score and report. Here’s how:

• When you settle your credit card debt for less than the full amount owed, the lender usually reports the account status as “settled” or “settlement” rather than “paid in full.”

• This status indicates to future lenders that you did not pay the entire loan amount, which can negatively impact your credit score.

• A settlement may stay on your credit report for up to 7 years, potentially affecting your ability to get new credit or loans at favorable terms.

• However, settling your dues is often better than defaulting completely, which causes more severe damage to your credit profile.

If you want guidance on how to manage your credit card settlement and minimize CIBIL impact, Legals365 can assist you.

Visit: www.legals365.com
Call: +91 9625961599

Advocate B.K. Singh and the Legals365 team are here to help you make informed decisions and protect your credit health.