Do you have the funds needed to close your bike loan before the maturity of the loan tenure? Lenders allow borrowers to foreclose or prepay their motorcycle loan if necessary funds are available. However, certain factors need to be taken into account. Discussed below in detail is the procedure for the foreclosure of two-wheeler loans.
#1 Check the lock-in period
Most lenders fix a lock-in period on their loans, ranging from 3 to 6 months. You cannot prepay your loan during this lock-in period. Therefore, you need to check with your lender whether or not you have passed the lock-in period to be able to foreclose your bike loan.
#2 Find out the outstanding loan amount
The next step towards the foreclosure of a two-wheeler loan is to determine the loan amount that is outstanding or still needs to be paid. You can do this by giving a call on your lender’s customer care number. The customer care executives will check your loan details and let you know the amount that is outstanding.
#3 Consider the prepayment charges
Prepayment of your loan might bring with it certain prepayment charges. Usually, a percentage of the outstanding principal amount is charged as prepayment charges. So, before prepaying your motorcycle loan, check with your lender’s website the prepayment charges and keep that amount ready along with the outstanding loan amount.
#4 Acknowledge your lender’s email
You will receive an email from your lender consisting of all prepayment information. This will include your loan account number, the outstanding loan amount, as well as the prepayment charges. Acknowledge this email to confirm that you are willing to prepay your bike loan.
#5 Make the payment
The next step is to make the payment, which includes the outstanding loan amount + the prepayment charges. You can make this payment either via cheque or a demand draft with your loan account number mentioned. You can even visit the nearest branch office of your lender and make an online payment with the help of lending experts.
#6 Notification regarding loan closure
Once your payment has been received, your lender will send a notification your way, confirming that your two-wheeler loan has been paid in full. Make sure to cross-check all the details to see if the right information has been mentioned regarding the prepayment of your loan.
#7 Collect the NOC certificate
The final thing left to do is to collect your NOC or No Objection Certificate from the lender. You can obtain this certificate both in the online and offline format. This certificate is a must since it is the only proof you have for your bike loan prepayment.
Want to apply for two-wheeler finance? You can easily do so online! Compare between lenders to choose the one offering flexible repayment options and competitive interest rates. Also, check your two–wheeler loan eligibility criteria and make sure you submit all the required documents.