Loan Closed, But Still Showing Active? How to Get It Fixed

The common headache

You’ve made the last EMI.

Maybe you even have the closure letter.

But your credit report still shows the loan as “active” or “overdue”.

It’s annoying – and it can affect new approvals.

Why this happens

Most of the time, it’s one of these:

·         Reporting lag – the lender closed it, but the latest update hasn’t gone to all bureaus yet.

·         Partial closure – some fee or last small amount remains due.

·         Process miss – closure done in the core system but not tagged properly for bureau reporting.

Bureaus usually only show what lenders send.

Step 1 – Check your own records

Confirm for yourself:

·         You’ve paid all EMIs and final dues.

·         You have a loan closure letter / email or at least a final statement showing zero balance.

·         There aren’t any small charges (late fees, etc.) still hanging.

If something is unclear here, solve that first.

Step 2 – Wait one cycle (if very recent)

If you closed the loan just last week:

·         Give it 30–45 days to reflect in the next reporting cycle.

·         Then pull a fresh report (not an old cached one in an app).

If after that it’s still showing active, move to the next step.

Step 3 – Raise a closure correction with the lender

Contact the lender through:

·         Email / app / branch – something traceable.

Share:

·         Loan account number,

·         Date of final payment,

·         Closure proof (letter / statement).

Ask them to:

·         Update their internal records if needed, and

·         Send correct closure status to all credit bureaus.

Keep the complaint number.

Step 4 – Monitor your report

After the lender confirms, wait for another reporting cycle and check:

·         Status should move to “closed” or equivalent.

·         Outstanding should show zero.

If it doesn’t, follow up with your previous complaint reference.

Common mistakes

·         Only arguing with the bureau and not involving the lender.

·         Relying only on phone calls with no written trail.

·         Assuming “it will sort itself out” and forgetting until the next rejection.

What you can actually do

·         Stay factual and organised.

·         Keep copies of all emails and letters.

·         If the loan was with a smaller NBFC / fintech, be extra careful about documented closure.

·         For future loans, always ask for a closure letter and keep it safely.

A wrongly “active” loan on your report is usually a data and process problem, not a punishment.

If you’ve truly closed it, your job is to patiently align the systems with that reality – not to accept the file as final just because it came from a bureau.