There’s nothing like paying off your loan and being a proud homeowner to make you feel overwhelmed. While you’re celebrating the end of your home loan EMIs, you should be aware of all parts of the process. Because a home loan isn’t deemed completed unless your lender says so, we’ve put together a checklist that you may check off to guarantee that your loan is closed and avoid any future issues.
Checklist when closing your home loan
Collect your original documents
Any lender who accepts your application for a home loan keeps all of your original documents, leaving you with only photocopies. Make sure you have all of your original papers back from the bank when it’s time to pay off your loan. You must also ensure that all of the documents you have received are in good condition. The following is a list of possible papers you’ll require from your lender:
- Sale Deed
- Title Deed
- Loan Agreement
- Power of Attorney, and more
Obtaining the “No-Dues” certificate
A ‘No Dues Certificate,’ or NDC, is one of the most crucial documents to obtain after the loan has been repaid. A No Dues Certificate certifies that you have no outstanding debts and that the lender has no right to claim the property. The NDC must include information such as the property address, client names, loan account number, loan amount, and loan start and end dates. To facilitate seamless interactions in the future, it is recommended that you make copies of NDC (both hard and soft). If you want to sell your property, you’ll need an NDC.
Removal of the lien on the property
Unless all of the debt is paid off, a lien provides the lender the right to your property. You won’t be able to sell the property if you have a lien on it. As a result, lien elimination is critical to the completion of home loan. To complete this activity, you will need to go to a registrar’s office with the help of a lender’s office.
Get the updated non-encumbrance certificate
You must visit the Registrar’s Office and apply for a new Non-Encumbrance Certificate once you have paid the total home loan in India and the lien has been removed from your property. It’s a legal document that contains meticulous details of all financial transactions involving the property.
Take security checks back
If you’ve given the lender post-dated security checks, make sure you get them back when your home loan account is closed.
Credit score updation
Following the repayment of your loan, your credit reports must be updated. It takes between 20 to 30 days for your credit score to be updated. As a result, get a copy of your credit report and double-check it for accuracy. Talk to your lender if your credit score hasn’t changed.
Obtaining bank statement
To avoid any future problems, make sure you collect all of your loan repayment statements from the bank. Keep in mind that if you don’t obtain all of the bank statements after repaying the loan, it is still not complete.
Closing a home loan is just as important as any other component of it. As a result, it’s critical to get the records straightened out and updated on time. For a proper home loan closing, all of the stages described above must be completed.