Personal loan can be very helpful for you, when you have unexpected emergencies or sudden cash crunches, as it is easy to access with minimal documentation. But as amazing it seems, it comes with a major disadvantage that the rate of interest. If you already have the access of personal loan then it should be your first and most important priority to close the personal loan as you are ending up paying a high interest. There are two ways through which you can easily close off your loan amount of personal loan, either you can continue to pay the loan amount according to full tenure of personal loan or you can pre-close the amount, which means you can close the full amount before the tenure of the loan amount gets over.
PROCEDURE TO PRE-CLOSE YOUR LOAN AMOUNT
Clearing off your loan amount before the tenure gets over is called the prepayment or pre-close of the loan amount. Some lenders levy charges for preclosing the loan. However, pre-closure helps you to lower your interest rate and debt burden. Following are the procedures involved in pre-closing your personal loan.
Visit your bank where you have taken the personal loan.
Carry the necessary documents such as your ID proof, your bank statements, mentioning the clearance of your last EMI, your loan account number and a cheque or DD for prepaying your entire loan.
The lenders usually charge certain percentage from your loan amount which must be paid along with the prepayment.
After paying your prepayment amount through cheque, cash or DD, the bank will give an acknowledgment letter, mentioning about the closure of your loan amount which has to be kept safely for future references.
After the completion of all the steps, the bank will send you the loan agreement, few days after the closure of the loan.
PROCEDURE TO CLOSE YOUR LOAN AMOUNT THROUGH A REGULAR WAY Through this way, an individual closes the loan after completing the entire tenure, as a regular closure. After fully making the repayment of your loan, you need to follow few procedures to close the loan.
After you have successfully repaid your loan, then approach the bank where you have taken your personal loan from and inform them about closing your personal loan.
Carry your ID proof, loan account number and a cheque if there is any amount to be paid. The bank will officially verify all your documents and loan account before proceeding for the closure.
After completing the whole process, your account will automatically be closed. You will then get a ‘Non-Objection Certificate’ (NOC) from the bank which is the proof of closing the loan. This certificate states that the borrower has repaid the entire loan and there is no outstanding balance pending.