Thanks!! Hi! Is there any high chances that cibil score would go down if we dont pay off the educational loan and what if even when they written off or settle the account after negotiation has been made? Please reply at the earliest possible. Will I be still a defaulter if I negotiate and pay only some partial amount?
Loan defaults will affect your Credit Score. This includes Education Loan, Home Loan and Personal Loan. If the bank writes off your loan, that will also have a negative impact on your Credit Score. This is because banks mention how the loan was closed to credit bureaus and this is included as a remark in your credit report.
You will not be mentioned as a defaulter in your credit report if you close your loan account. However, if you pay a partial amount and your loan account is not closed, you might be listed as a defaulter. It will be better to negotiate with your bank and ask for a one-time settlement to pay off your Education Loan. This way, your Credit Score will not go down as much as it would if you were a defaulter.
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