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Closing any Personal Loan will help you in reducing your debt burden. The earlier you close your personal loan, the better it would be for you. Though Personal Loan is a great option to fight with the financial exigencies in one’s life, it still adds a burden onto a borrower’s shoulder. It is not only important to close your personal loan so that you can focus on savings, but it is also important to close a Kotak Personal Loan in a proper way.
How to Close Kotak Bank Personal Loan through Creditseva
Eventually, everybody knows that a personal loan has always been an option that involves a high-interest rate. So it is good to close your personal loan at the earliest. So if you are willing to close your Kotak Personal Loan, Creditseva will aid you in closing Your Kotak without any complications by providing proper guidance and support. You need to just signup and login to use the loan closure tool provided by Creditseva. This real-time loan closure platform helps to get the best offers from banks to close bad loans and make payments to banks directly.
Procedure for Closing a Kotak Personal Loan
The following are the steps to be followed while closing a Kotak Personal Loan.
- First of all, you need to completely pay off your entire balance that is outstanding.
- The next step is to write a letter to the bank requesting them for closing your Kotak Personal Loan.
- The third step is to ask the Kotak bank for a letter of closure and an NOC.
- Finally, you need to get an assurance from the Kotak bank that the Kotak bank has sent the credit bureau the information that you have closed your Kotak Personal Loan.
Points to Be Kept in Mind While Closing a Kotak Personal Loan
- It has been always seen that the borrowers are uncertain about prepaying the loan if there are pre -payment charges associated with the loan. But the fact is that whenever you prepay your Kotak Personal Loan, you are saving on the amount of interest.
- Sometimes there are some offers that last for a limited period. These offers include nil charges for pre-closure.
- The prepayment charges for personal loans are the most crucial factors that should be ascertained beforehand by the borrowers so that there is no confusion while prepaying the personal loan.
- Usually, there is no prepayment allowed for the initial 6 months. Later on, a penalty of 5 % is charged on the outstanding principal amount.
Reasons to Prepay Your Kotak Personal Loan
If the proper comparison of the borrowing cost and lending cost is done while deciding to prepay the Kotak personal loan, you will find the reason for prepaying your personal loan. It has been observed that borrowing costs are mostly higher than the lending costs.
So, by doing a proper analysis of these two costs and their percentages, you will understand that you can save on an additional cost by prepaying your loan.
Reasons for Banks to Charge Prepayment Fees
Generally, a bank is said to borrow money at low cost and lend it at a price that is higher than the one it has paid for borrowing the money. After they have lent this money, they will get back an amount which is actually the difference amount for the loan period.
In such a scenario, if you take a decision to prepay the loan at an early stage, the interest that the bank gains from an additional loan period get reduced. So to manage for the loss of this amount, the banks opt for charging the penalty for prepayment of a personal loan.
Fore-closure Covering Letter:
This letter is written by the bank that has granted the Personal Loan to the borrower. The main motive of writing this letter is to explain the borrower about the exact steps to be followed in the process of closing a Kotak Personal Loan
Sample Covering Letter of Foreclosure (Written By Kotak bank after your request for Foreclosure)
Dear Sir/ Madam,
This letter is a reply to the letter you had sent us while requesting for foreclosing your Personal loan. You had requested us to calculate the amount of foreclosure as on the date…………………….. And also other details related to it.
As per your request, the Foreclosure amount as on the date…………..is Rs ————– It is important that you keep in mind the validity of this foreclosure amount. As the interest is calculated on per day basis, there will be some changes in the foreclosure amount after the date has changed.
Therefore it is compulsory that you check with us about the particular amount on that particular day when you are foreclosing the loan.
Outstanding Principal as on xx/yy/zz Rs. XXXXX
Interest on Prepayment (5% on Principal Outstanding + Service Taxes) Rs. XXX
Per day increase in the amount- Rs. xx/-
Kindly follow the process for foreclosure specified by the bank. You can also contact our customer care in case you have any queries.
Kotak Personal Loan Closure FAQs:
1. When should I foreclose my Kotak Personal Loan?
If you are willing to close your Kotak Personal Loan, you need to give intimation 30 days prior to the foreclosure.
2. Are the prepayments allowed within 12 months of the Kotak Personal loan period?
We do not allow prepayments for a period of 12 months from the date of your first EMI.
3. What is the exact process for full prepayment of Kotak Personal Loan?
- Firstly, you should intimidate the bank that you are planning to make the full prepayment. This can be done by writing an email.
- After you have completed intimating the bank, the issue of the statement of foreclosure will be done by the bank.
- A cheque for full prepayment should be dropped at the bank’s branch at least 7 working days before the arrival of next EMI.
- You can pay for the foreclosure either through cheque, cash or DD after the completion of intimation period.
- After the clearance of your foreclosure cheque, your Kotak Personal Loan will get registered in the bank’s written records.
- You will receive the No Objection Certificate and the cheques that belong to the dates post loan closure through a post after your personal loan has been terminated.
- After a period of 12 months and an intimation period of one month the charges of foreclosure that would be charged will be 5%. It also includes the principal on the outstanding service tax.
4. Is there any part prepayment facility on Kotak Personal Loan Closure?
We do not offer a part prepayment facility on your personal loan account.
5. When can I expect my NOC?
- You will receive your NOC by post if your Kotak Personal Loan is foreclosed.
- You will receive your NOC after 15 days of terminating the loan if you have opted for a loan top up.
Personal Loan Closure by Banks
- Personal Loan Closure
- Axis Bank Personal Loan Closure
- Andhra Bank Personal Loan Closure
- HDFC Bank Personal Loan Closure
- ICICI Bank Personal Loan Closure
- SBI Personal Loan Closure
- Citibank Personal Loan Closure
- Bank of Baroda Personal Loan Closure
- Capital First Personal Loan Closure
- Allahabad Bank Personal Loan Closure
- Fullerton Personal Loan Closure
- IDBI Bank Personal Loan Closure
- IndusInd Bank Personal Loan Closure
- Standard Chartered Bank Personal Loan Closure
- Tata Capital Personal Loan Closure
- Union Bank Personal Loan Closure
- Bajaj Finserv Personal Loan Closure
- Kotak Bank Personal Loan Closure
- Yes Bank Personal Loan Closure
- SBH Personal Loan Closure
- HSBC Personal Loan Closure
- Oriental Bank Personal Loan Closure
- RBL Bank Personal Loan Closure
- PNB Personal Loan Closure
- J&K Bank Personal Loan Closure
- IOB Personal Loan Closure
- Karur Vysya Bank Personal Loan Closure