Often termed as India’s “Silicon Valley,” Bangalore houses about 2 million IT workers. Bangalore also possesses a host of educational facilities, medical centres, and shopping complexes. With its beauty and many IT-enabled services, Bangalore is a great place to settle down.
Taking a home loan in Bangalore is your best option if you do not have the cash needed to buy, build, or construct a home in a city like Bangalore. As you know, a loan is a long-term monetary deal that involves frequent payments. However, what happens when you want to close the loan early?
Perhaps you recently had a salary increase, and if you can cope with paying the remaining equated monthly instalments (EMIs) at once or in a lump sum, then go for it. Remember that closing your loan early makes it easy to get approved for other loans, and it gives your credit record a great look.
Read on to learn how to do this’.
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Guidelines for Closing Your Home Loan in Bangalore Early
A foreclosure or prepayment are options that you can utilise to complete the repayment of your home loan early. However, you must follow an exact process to ensure that you do it right. Following these guidelines ensures that you can take future home loans without difficulty.
Read on to find the guidelines listed below.
Notify Your Lender
Even though your lender has your loan record, you must notify them regarding your desire to close your loan early. Include the exact date in your notification.
Assemble the Necessary Documents
The next step is to assemble the documents which comprise the loan agreement and the EMI receipts from the first payment till now. You are guaranteed a hassle-free verification once you have these documents.
Evaluation of Payments
As part of the steps taken to close a home loan, the lender will undertake several verifications regarding the payments made and the loan-related documents. We suggest that you make yourself available for this purpose. Doing so quickens the process.
Obtain a No Objection Certificate (NOC)
Lenders like banks and Non-Banking Financial Companies provide borrowers seeking an early closure of their loan with a NOC. The certificate declares you free of any payment regarding the home loan. Also known as a certificate of home loan closure, getting it from your lender is the next step.
Omit Lien on the Property
It is not a mandatory step but if your lender had placed a lien on your property to prevent its sale, then proceed to cancel it. By doing this, you can now sell the property if you desire. Removing the lien requires up to 10 business days.
Collect Security Cheques
If you sent any post-dated security cheques or cheques to your lender, now is when you collect them.
Obtain a Fresh Encumbrance Certificate (EC)
Upon closing your home loan, you can obtain a certificate of fresh encumbrance which contains all your property-related financial transactions. It also demonstrates the freedom of your property from any liability, whether monetary or legal. By collecting this certificate, you can easily sell your property.
Regain Your Documents
Remember the documents that your lender required to process your home loan application? They’re still in your lender’s custody, so get them back to formally finish the loan.
Edit Your Credit Report
Ensure that you update your credit score to show that you have completed the home loan repayment. We previously said that early closure of home loans boosts your credit score. So, doing this improves your score and report.
Keep Tabs on Your Loan Repayments
You should have a comprehensive report of every payment made towards the home loan. For this purpose, you can use your bank account statements.
Obtain a Legal Clearance Certificate from Your Lawyer
This certificate declares that you have full access to sell your property. To get this, you will pay any lawyer a small fee.
Many people assume that closing a loan before the end of the tenor is a highly complex task. While the process is certainly not simple, it is also not impossible to close a loan before the end of the tenor. If you want to close your loan, simply follow the steps mentioned above and the whole process will look easy.