If your home loan is about to end, do not forget to do these 5 things! Otherwise, you will not be able to get ownership of the property.
After paying EMI every month for years, when the home loan ends, it feels no less than a big achievement. The journey of a home loan is very long, so when this journey ends, there is a different satisfaction and relief. But do you know that your work is not over even after repaying the loan? Just like all kinds of paperwork have to be done while taking a loan, similarly some important work has to be done even after repaying the loan. If you ignore these works, then in future you may have to face big problems regarding your own property. Know about the 5 most important things.
This is the first and most important step. While taking a home loan, you must have mortgaged all the original documents of your property like Sale Deed, Builder-Buyer Agreement, Possession Letter, Allotment Letter and other legal documents in the bank. As soon as the loan is closed, apply to get back all your original documents from the bank. When the bank hands over the documents to you, check each paper carefully. Make sure that no page is torn, damaged or missing. Make a checklist and match all the documents. These documents are the biggest proof of ownership of your property.
No Dues Certificate (NDC) or No Objection Certificate (NOC) is a legal document issued by the bank. This is proof that you have repaid the entire loan amount along with interest and now the bank has no right over your property. Ask for NDC from the bank at the time of loan closure. All the information like your name, property address, loan account number, starting and ending date of the loan should be written correctly in this certificate. This document acts as a protective shield for you in case of any dispute in the future. It proves that you have repaid all the loan to the bank.
When you take a home loan, the bank puts a lien on your property. This means that as long as the loan is running, the bank has rights over that property and you cannot sell it without the bank's permission. After repaying the loan, it is your responsibility to ensure that the bank has removed the lien from the property. For this, you may have to go to the registrar's office with a bank official to complete this process. If the lien is not removed from your property, then in government records it will still be considered mortgaged to the bank and you will not be called its real owner.
Non-Encumbrance Certificate (EC) is the financial record of your property. It contains complete details of when and how much loan was taken on your property and when it was repaid. After the home loan is closed, apply for an updated non-encumbrance certificate from the sub-registrar office. This new certificate will record that your home loan is now closed. When you go to sell your property in the future, the buyer will definitely ask you for this certificate. This is proof that there are no financial liabilities or legal disputes on the property.
A home loan is a big responsibility and repaying it on time improves your credit score (CIBIL Score). But it is also important that this information is updated in your credit profile after the loan is closed. Check your latest credit report after 30-40 days of loan closure. Make sure that your home loan is shown as 'Closed' in it. If it is not, then immediately contact the bank and credit bureau (such as CIBIL, Experian) and get it corrected. An updated and good credit score will help you get another loan (such as a car loan or personal loan) easily and at better interest rates in the future.
