A Home is a Biggest Asset, Where as Home Loan is Biggest Liability. According to one of research agency, Closure of Home Loan is considered to be one of the 3 Biggest Happiness in Human Life i.e. 1st Job, 1st Love and Home Loan Closure. This happiness can convert into sadness, if we don’t follow some important procedures or steps while closing the Home Loan. As we know while taking Home Loan, we mortgage our property with lender and at the same all the original documents are with lender..It is important that at the time of closing Home Loan, we should take care of following points
1. No Objection Certificate (NOC): It is very important to take NOC from the Lender..NOC should clearly mention the address of Property against which loan was taken, Name of Borrower & Loan Account No of Borrower. Secondly, it should state that all the dues are paid by the Borrower and Lender does not have any rights or claims on the Property.
2. Original Documents Submitted to Lender: At the time of availing Loan, we submit whole lot of documents with Lender, It is critical to recover all the original documents from Lender. At the time of availing loan lender issue the List of documents submitted by the borrower…This list comes handy at the time of closure..You should recover each and every original document submitted with Lender.
3. All Document Pages are Intact and not misplaced: All lenders keep the original documents of Borrowers normally at centralized locations and this work is normally outsourced to the 3rd party agencies e.g. Bank A maintain Centralized repository at Mumbai. Now suppose, i took a loan from Bank A then my documents are passed through many hands like from Branch to Legal Department, Legal Department will forward to Regional Head Office with comments and then they will forward to Mumbai office of Bank A. Mumbai office will then hand it over to agency and agency will give documents to operations team to keep them in Locker…While closing loan, reverse process is followed…Recently, one of my colleague closed her Loan and took documents from HFC. Over weekend when she was casually checking the documents, she observed that Last Page of the Original Sale Deed was missing…Legally its a mess for her to resolve this issue becoz process is very tedious, if any document or page goes missing…After Loan Closure, Never ever request the documents through courier from Bank / HFC…Always visit the Branch personally to collect the documents and Most critical part is to check each and every page of the documents received in front of Bank official before signing the acknowledgement that you received the documents back. After you sign the acknowledgement, there is no liability of Bank or HFC if any document or page is missing.
4. CIBIL Database Update: Whenever u take loan, Banks or HFC’s are very pro-active to inform CIBIL regarding the same but while home loan closure this pro-activeness is missing specially if its pre-closure. While closing the loan, u can give written request to Bank or HFC to inform CIBIL regarding closure of ur Loan account and all dues are paid..It is very important else your CIBIL score will remain low…Ask Bank or HFC, how many days they will take to update the CIBIL database..Normally this process take 30 days from Date of Loan Closure…Request Bank or HFC to inform u when they update the CIBIL datebase or you can follow up with them. Post database is updated by Bank or HFC, You can request for CIBIL report either from their website or manual request through courier and you can cross verify whether your Bank or HFC has updated your CIBIL record or not..If it is not updated then you can write to CIBIL and send them NOC issued by Bank or HFC. You can directly request CIBIL to update your records and this facility is available online also..CIBIL normally revert within 15-20 days with status update on ur request as they check with bank or HFC for confirmation.
5. Remove Lien from Registrar Office: Last but not the least is to get Lien removed on property from Registrar office. Lien is a legal claim against an asset which is used to secure a loan and which must be paid when the property is sold. In layman terms, many times if Bank or HFC is doubtful of Borrower then they register the mortgage document in Registrar Office and put a Lien on the Property similar to Lien in case of Auto Loan. In case of Auto Loan, on the RC of vehicle it is mentioned that vehicle is mortgaged or HP. What it means is that till the time Lien is removed from your property on request of lender, you cannot sell your property. You can check with your Bank or HFC whether they have put Lien on your property. If yes, then you should ensure that it is removed post Loan Closure otherwise may be after few years if u plan to sell your property then again u need to visit your lender to get it removed.
It is very important to follow above 5 points so that after closing your Home Loan, your property is truly yours.
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