Closing your home loan is really a big step towards your financial and mental health. A big chunk of money has been paid from you to closing a loan. But never forget to remember these things while closing your home loan. Let’s know what things are?
Proof of Ownership: Original documents are the legal proof that you own the property.
Future Transactions: If you plan to sell, refinance, or use the property as collateral, these documents are necessary.
Avoid Legal Issues: Keeping these documents safe ensures you avoid any legal complications related to property ownership.
First, you need to ask your lender to release all the property documents. This typically includes the sale deed, title deed, loan agreement, property registration documents, power of attorney and any other documents submitted during the loan process.
A No Due Certificate (NDC) is an important document that proves you’ve repaid the entire loan and have no remaining dues. It confirms that your home loan is fully settled.
You have to check the details like Name, property, address, loan account number, loan amount, starting or closing date and other information carefully.
3. Remove the property lien
A lien is a legal claim a lender has on your property until you repay the loan. After you pay off the loan, it’s important to remove the lien to confirm that you own the property fully and clearly.
Clear Ownership: Removing the lien makes sure the property is fully yours, with no claims from the lender.
Future Transactions: It's necessary for future property transactions like selling, refinancing, or using the property as collateral.
Avoid Legal Issues: Removing the lien helps prevent legal problems that could come up from disputes about property ownership.
When you ask your lender to remove the lien, the lender will provide a lien release document stating that the lien has been removed.
A Non-Encumbrance Certificate (NEC) is a document that proves your property has no legal or financial issues. After closing your home loan, getting an updated NEC is important to show your property is free of any problems.
Proof of Clear Title: An updated NEC shows that there are no legal or financial claims against the property.
Future Transactions: It is needed for selling, transferring, or mortgaging the property.
Avoid Legal Complications: Making sure the property is free of encumbrances helps avoid legal issues about ownership.
Apply for NEC: Visit the local sub-registrar’s office or apply online (if available) to request an updated NEC.
Provide Necessary Documents: Submit the necessary documents, including the lien release document, NDC, and proof of identity.
Verify Certificate: Once issued, verify the NEC to ensure it accurately reflects that there are no encumbrances on the property.
Updating your credit report to show that your home loan is closed is important. It can improve your credit score and help with future borrowing.
Improved Credit Score: Closing a loan and clearing all dues positively impacts your credit score.
Future Borrowing: An updated credit report with no outstanding home loan enhances your creditworthiness for future loans.
Accurate Credit History: Make sure that your credit report accurately reflects your financial history and current status.
If the loan closure isn't updated or there are mistakes, report them to the credit bureau with documents like the NDC and lien release.
| Step | |
|---|---|
| Collect Original Documents | Retrieve all original documents from the lender to ensure proof of ownership and for future transactions. |
| Collect No Due Certificate | Obtain the NDC from the lender as proof of full loan repayment and to avoid legal issues. |
| Remove Property Lien | Ensure the lien is removed from your property to secure clear ownership and facilitate future transactions. |
| Collect Updated Non-Encumbrance Certificate | Get an updated NEC to confirm the property is free from any legal or financial liabilities. |
| Update Credit Report | Ensure your credit report reflects the loan closure to improve your credit score and future borrowing potential. |
Closing your home loan is an important financial milestone. To make sure everything goes smoothly, collect all original documents, get a No Due Certificate, remove the property line, get an updated Non-Encumbrance Certificate, and update your credit report. This will help you secure your property and avoid future legal and financial issues.
How can EazyBankLoan help you in taking a loan? We understand the process of procuring a loan can be stressful. That is why we take care of your Loan application process, saving you time and hassle by handling the paperwork and communication with the loan providers.
Check the details here at EazyBankLoan
Need help? Reach out at support@eazybankloan.com
Collecting all original documents is crucial because they serve as proof of ownership and are required for any future transactions related to the property. It also helps avoid legal complications.
A No Due Certificate (NDC) is an official document from the lender stating that you have fully repaid your home loan and have no outstanding dues. It is essential for future financial transactions involving the property and for avoiding legal issues.
Updating your credit report to reflect the closure of your home loan can improve your credit score and enhance your creditworthiness for future loans. It also ensures that your credit report accurately reflects your financial history and current status.
No List Founds!
Your email address will not be published. Required fields are marked *
