Things to keep in mind while closing your home loan

Congratulations! Close to the action, the last step in your home loan journey— is home loan closing. Using a home loan closure checklist is a must for a smooth and hassle-free closure.In this blog, we'll enlist some important things to know about the closing home loan process.So, let’s get into it and go over everything you need to know to bring your home loan to a successful closing.

Closing on a home loan is not just about the last payment. It requires various processes to guarantee that your property is really yours and is not subject to any legal claim.

Here’s a break down of the steps involved in the closing of a home loan:

a) Alert Your Lender

Let your lender know ahead of time that you want to close on your home loan.

b) Final EMI Payment

Ensure that you pay all dues, including the final EMI.

c) Gather Your Documents

Collect original property documents & legal papers submitted before loan approval

d) Obtain a No Objection Certificate (NOC)

NOC is a formal proof that you have repaid the complete loan amount and that the lender does not have a claim on your property.

A detailed checklist of when you get your home loan closed helps ensure you don't miss any of the critical steps.

What helps you during this process is a home loan closure checklist. Here’s what it should tell you:

a) Clear All Outstanding Dues

Make sure you do not have any pending dues. Verify all EMIs — Keep a check on your loan statement and verify that all EMIs are recorded properly. Any outstanding balance, however small, can delay the closing.

b) Collect the NOC

NOC is an essential document that indicates that your loan has been cleared. It’s also a required proof for future real estate transactions.

c) Get Your Property Documents

When you applied for the loan, you did submit the original property documents like sale deed, title deed, agreement etc., to the lender. Make sure all documents are returned in good condition.

d) Eliminate the Lien on Your Property

After you have taken a home loan, the lenders put a lien on your property. And when the loan closes, you have the lien removed, so your property is legally free.

e) Update Credit Records

When the loan is closed, contact credit bureaus, like CIBIL, to see if your records are updated with a loan closure. This is important for a good credit score.

If you follow this home loan closure checklist, you will have a hassle-free experience.

The NOC is not just a piece of paper; it is the gate pass to your seamless property ownership. Without it, showing you’ve closed your loan can be a challenge. The NOC contains the following details that should always be verified:

a) Your name
b) Loan account number
c) Property details
d) Evidence of total reimbursement

This document is essential to update government files and to have the lien released from your property.

During closing home loan process, lenders sometimes introduce extra fees. Be aware of these potential costs and incorporate these into your final payment.

Review the agreement for your loan to see if there is any charge for prepayment or foreclosure.

When receiving your documents from the lender, examine them closely. Here’s what to look for:

a) Are all of the original documents present?
b) Are there any missing pages?
c) Is there evidence of damage or tampering?

So first and foremost, check the status of property documents, as they are the basis of ownership rights.

It is important that you keep track of all your EMI payments, final settlement receipts and the NOC. The above-mentioned documents will be required at the time of closure of the loan, and they could prove useful in case you need to prove the loan closure later on.

When your home loan is closed, you need to update the following:

a) Registrar’s Office

Make sure the title to the property is transferred to you and in your name free of the lender lien.

b) Society or RWA

Notify your housing society or resident welfare association about the loan closure and update their records.

These changes are included in our ultimate home loan closing checklist to help avoid problems down the road.

Your credit score is a measure of your financial discipline. Once your home loan is closed, verify that it has shown on your credit report. A mix-up on your credit report can hamper your chances of getting a loan in the future.

Once you’ve paid the final payment, it may seem all set to sit back and relax but the process of closing the home loan isn’t complete until each and every shot on your home loan closure checklist is ticked. Missing any step can cause legal or financial issues down the line.

Closing home loan process may feel like a financial transaction, but it’s actually the last step in taking full ownership of your dream home! A detailed home loan closure checklist will help you have a seamless experience.