Home Credit Loan Settlement: Request It and Get the Letter

Settlement is not something a borrower chooses out of preference. Home Credit India considers it only when you genuinely cannot repay in full. The lender then decides under its own policy, and nothing here is a lender offer.

Check who holds your loan. Three plain facts help.

1. Home Credit India Finance Private Limited is an NBFC (non-bank finance company), not a bank. This page is about its personal loans and consumer durable loans, not home (housing) loans, which are a different product.
2. Ownership has changed. In February 2025, Home Credit Group completed the sale of its India business to a group led by TVS Holdings, and the lending company is the same legal entity under new owners. Ask the lender in writing which entity now holds your account.
3. Some personal loans were offered with DBS Bank India under a co-lending arrangement (two lenders sharing one loan). Read the lender names on your loan agreement and statement.

A lender can also sell a long-overdue account to an ARC (Asset Reconstruction Company, a firm that buys bad loans). If that has happened, the settlement is with the new owner.

FREED covers unsecured loans only. You can read about the Loan Settlement Plan, and see how overdue accounts are labelled in our guide to NPA accounts.

Home Credit considers settlement when full repayment is genuinely not possible. That is usually after the account is overdue and marked NPA (a loan the lender has classified as bad, commonly after 90 days of missed EMIs). Home Credit does not publish a threshold, a timeline or a waiver.

One rule applies to every regulated lender, NBFCs included. RBI’s framework lets a lender settle under its own board-approved policy, with approval from an authority at least one level above the one that sanctioned the loan. So the person on the phone usually cannot promise you an outcome. The framework lets a lender settle. It does not give you a right to a settlement.

These loans are often small, so weigh the cost and effort of any route against the balance. Before you ask for settlement, ask Home Credit for a lower EMI, a longer repayment time, a payment pause or restructuring. Our guide to loan restructuring under RBI rules explains that route, and bank loan settlement rules covers the wider framework.

Follow these steps in order. Keep proof of everything you send.

1. Get the written outstanding statement. It should split principal, interest and penal charges.
2. Note your contract number and registered mobile number. Home Credit asks for them when it verifies customers.
3. Write the request. Give your name, contract number and the amount outstanding. Add why you cannot repay in full (two factual sentences), the lump sum you can pay and by when, and ask for the terms in writing.
4. Send it to the lender’s official communication address and by email. Home Credit states that it responds only to communications sent to that address. Keep proof of sending.
5. Follow up through customer care. Note the date, time and name every time.
6. Respond to a counter-offer calmly and in writing. A FREED counsellor can help you prepare.
7. Hold your replies until you have the written offer.

Keep the tone factual. No pleading and no threats. For wording help, read how to write a loan settlement letter to a bank, a debt settlement letter sample, the loan settlement application and how to negotiate a personal loan settlement.

Do not pay on a promise. Go through this list and tick every line first.

1. It is on the lender’s letterhead and signed by an authorised officer.
2. Your name and contract number match your records.
3. The amount is stated in numbers and in words.
4. The deadline and any instalment terms are stated. A settlement paid over more than 3 months is treated as a restructuring, so ask for a short window.
5. It says the dues are cleared on payment and that the account will be reported “Settled”.
6. It shows where to pay. That means a loan account or an official payment link, never a personal account, UPI ID or wallet.
7. You confirmed the offer yourself with the lender’s own contact details.
8. It says what you will receive after paying. That is the NOC (no objection certificate) and a closure confirmation.

If the letter or NOC does not arrive after you pay, ask in writing, then escalate.

Rates and ranges shown are indicative. Final terms decided by the bank. FREED is not a Loan Provider. No outcome is guaranteed. Please verify directly with your bank.

Our guides on the final settlement letter format, what a one-time settlement letter includes, the loan settlement agreement and the CIBIL clearance letter show what good paperwork looks like.

Requirements vary by case, so ask in writing what is needed.

Rates and ranges shown are indicative. Final terms decided by the bank. FREED is not a Loan Provider. No outcome is guaranteed. Please verify directly with your bank.

Keep copies of everything with proof of delivery. Our loan settlement application guide shows how to put the request together.

The account shows as “Settled”, not “Closed”. The mark can stay up to 7 years. The drop in score is commonly reported at 75 to 100 points and varies by profile. The waived portion shows in the written-off amount field. If this is your first credit product, it can affect later loans and applications that check credit.

Here is what readers rarely hear. Lenders report to the credit bureaus fortnightly. If an entry is wrong, the lender must resolve your complaint within 30 days, with compensation of ₹100 per day beyond that.

After settlement, check your report after a few weeks and dispute any error with the NOC as proof. Keep your other accounts current and borrow carefully. You can see your report with Credit Insights. Read more on the impact of debt settlement on credit score and what written off in CIBIL means.

Home Credit India’s official contact page sets out the path. Start with customer care. If you are not convinced by the resolution, or get no response within the committed time, write to the Grievance Redressal Officer at the official address and email. If the issue is still unresolved, use the RBI complaint route (the RBI Complaint Management System).

If your loan was co-lent with DBS Bank India, DBS’s own page names a Principal Nodal Officer and the RBI complaint system as the final step, so you can approach either lender. Names, numbers and times change, so copy them from the official pages on the day you write.

If recovery calls or visits turn abusive or threatening, you can document and report them. FREED Shield is open to anyone. Read our guides on how to make a complaint against recovery agents and the RBI guidelines for recovery agents.

Think of it as a ladder. First ask Home Credit for a lower EMI, a longer repayment time, a short pause or restructuring. Many of these loans are small, so compare the cost and credit report effect of settlement with paying the balance in smaller steps, if you can.

If you are still paying every EMI on several loans, a consolidation plan may help. A new loan from a lending partner pays off your existing unsecured loans and card dues, so you have one EMI and one date, and your score does not drop. FREED’s Loan Consolidation Plan charges zero fee to the customer and needs a CIBIL score of 700 or above. Check your EMI Score before taking any new loan, and read personal loan vs debt consolidation and how to reduce a personal loan EMI legally.

Settlement is for borrowers who genuinely cannot repay in full.

Rates and ranges shown are indicative. Final terms decided by the bank. FREED is not a Loan Provider. No outcome is guaranteed. Please verify directly with your bank.

The FREED Loan Settlement Plan (also called the Debt Resolution Program or “Settle My Loans”) helps borrowers move from financial distress to a structured path toward resolving their debt and rebuilding their financial future.

Here is how it works. FREED reviews your full financial picture and builds a personalised plan. You save a fixed monthly amount into a Special Purpose Account (SPA), held by an independent trusteeship company. Once the corpus is enough, FREED negotiates with the lender and prepares the documents and letters. The lender decides the final terms, and you approve each settlement before any payout. It takes time, because the savings come first.

FREED covers unsecured loans only, and does not handle home (housing), vehicle or gold loans. An evaluation fee applies and is non-refundable. A success-based fee applies only when a settlement is completed. Banks and lenders may reduce dues by up to 50%*.

Rates and ranges shown are indicative. Final terms decided by the bank. FREED is not a Loan Provider. No outcome is guaranteed. Please verify directly with your bank.

Read more about the Loan Settlement Plan.

20,000+ accounts settled | 20,00,000+ customers counselled | ₹3,200 Cr+ debt managed