Pre-Closure is the process when one repays the loan before the loan tenure ends. Some lenders do levy a penalty for pre-closing the loan. Most people usually take lots of precautions while availing a loan whether a home loan, car loan, personal loan or any other type of loan. However, people generally become careless while closing or pre-closing a loan.
Documents required for Personal Loan Pre-closure
- Relevant loan documents.
- Proof of address and identity – Passport, Aadhaar card, Voter ID card, etc.
- Loan statements displaying the details of the EMIs paid till date.
- Cheque or demand draft.
Types of Personal Loan Closures
1. Regular Personal Loan Closures
A regular personal loan closure is when the borrower clears all the EMIs. Following the payment of the last EMI, the borrower has to intimate the lender to issue the No Objection Certificate for the closure of the loan and finally the loan closure certificate.
2. Bad Loan Closure
Bad loan is a loan where the borrower has defaulted on interest payments continuously for a certain period. Generally, banks write off bad loans in cases where the borrower is unable to repay the amount due to bankruptcy or other financial losses.
3. Personal Loan Pre-Closure
A personal pre-closure is basically when the borrower decides to close the personal loan before the set tenure. In most cases, the borrower can opt for a personal loan pre-closure after a year or payment of a minimum of 12 EMIs. When foreclosing the loan, the borrower will have to pay the EMI of the current month, any outstanding dues if there, are and the foreclosure fees.
4. Personal Loan Part-Payment
If the personal loan borrower wishes to reduce the monthly installments and the tenure of the personal loan, he/she can opt for a personal loan part payment. The part payment amount will be subject to the terms and conditions as set by the financial lender.
Why do you need to a close your Loan?
Here are some of the reasons:
- No outstanding debts against your name
- Reduced EMI values against your name in case of current additional loan or investment options
- Allows for better future investment or loan opportunities with same lender.
- Improved Credit Score
Procedure for Pre-Closing Personal Loan
Step 1: Visit the bank where your Personal Loan is active
Step 2: Carry the necessary documents such as ID Proof, Bank statements mentioning the final clearance of the last EMI, Cheque or Demand Draft with which you will pay the entire balance amount.
Step 3: The lenders usually charge some amount from the loan amount which must be paid along with the prepayment.
Step 4: Once the entire amount is paid either through a Cheque or Demand Draft, the Bank will give an acknowledgement letter which must be kept for future reference.
Once all the steps are complete, the bank will send the loan agreement after a few days of preclosing the Loan.
Documents you need to collect after Personal Loan Pre-Closure
- Pre-closure payment receipt.
- No Objection Certificate to close the personal loan.
- Personal loan closure certificate.
- Payment of dues certificate.
Where to get Personal Loan Pre-closed?
Omozing helps make Smart Money Moves for a Lifetime. They strive to get lowest interest rates and best terms for your Online Applications at www.Omozing.com . We’ve made business lending smarter, faster and easier by transforming the approval process from stumbling blocks to stepping-stones. This enables borrowers to not just get access to capital, but also understand what areas they need to work on in order to enhance their credit profile. Omozing ensures that Borrowers get a secure, safe and reliable application process that be tracked online.
5 Reasons to choose Omozing
1. Loans from INR 10k to INR 10 lakhs
Personal Loan Interest Rates starting from 0.8% p.m, and Loan amount ranging from INR 10,000 to INR 10,00,000. The Minimum and maximum repayment period ranges from 1 month to 48 months. CIBIL 600+ all company categories (including LLP, Self Employed, Proprietorship)
2. Cutomised Tailor Options
- Depending on your demands, we may provide quick financing of varying quantities at affordable interest rates.
- You have the freedom to utilise your loan anyway you want, whether for business or for immediate personal needs.
- Flexible repayment options depending on your specific cash flow and budget, as well as conditions that is beneficial to your position.
3. Lower CIBIL
While most lenders require borrowers to have a CIBIL score of over 750, at Omozing.com provide loans even with 600. Besides the CIBIL score, we also considers your age, employment status, and net monthly income.
4. Ways to apply
You can apply for a personal loan through us by 2 ways:
1. You can download our Mobile Application from Google app store.
2. Apply on portal using out Personal Loan link
5. Prompt Loan Disbursal
An easy online application process facilitates speedy verification and disbursal of loan. Get KYC verified from the comfort of your home and have our loan manager take care of an instant transfer of funds to your account.