By opting for a KreditBee Personal Loan preclosure, you can save on interest charges and the overall borrowing cost of the loan. However, certain terms and additional charges may apply depending on the policies of the lender. Before closing the loan, it is also essential to evaluate whether the foreclosure is beneficial to you or do the additional costs (if any) offset the probable savings. Thus to help you make an informed decision, here are some essential details regarding the preclosure of a KreditBee Personal Loan.
KreditBee does not require you to pay any additional charges if you choose to close your loan prior to the end of the set tenure. However, do note that this is subject to the terms and conditions of your loan agreement and the policies of KreditBee. Thus, it is important to reach out to the lender and get a clear understanding of the preclosure process and the foreclosure charges you need to pay, if any.
Before you close your KreditBee Personal Loan, here are some important requirements you may have to fulfil:
Pay Outstanding Dues
Any penalty, accrued interest charge, or loan processing fee which is due must be paid in full. Once paid, you can then pay the outstanding loan amount to effectively foreclose your loan account.
Make a Single Payment
In order to pre-close your personal loan, you are typically required to pay the outstanding principal amount in a single payment. This also includes any preclosure charges, as applicable as per the discretion of the lender.
Pay Through Approved Methods
Reach out to KreditBee and check the payment methods they accept. These could include net banking, NEFT, RTGS, cheques, etc. It is essential to pay the amount through an approved method to close your loan from a compliance and legal standpoint.
To foreclose your KreditBee loan, here are some simple steps to follow:
Check Your Loan Agreement
Learn about the preclosure terms, eligibility conditions, and applicable charges by checking your loan sanction letter. Ensure that you fulfil all the eligibility conditions as mentioned in the agreement before proceeding with foreclosing your personal loan.
Contact KreditBee
Open the official mobile app of KreditBee and log in using your credentials. You will find an option to preclose your loan on the app. You can also reach out to KreditBee’s customer service team to apply for a foreclosure. Additionally, do ask for a statement which includes details like your loan’s outstanding amount and preclosure charges.
Review the Preclosure Statement
Thoroughly check the preclosure statement and ensure that all the calculations are correct. Assess the additional fees and applicable taxes you may have to pay to foreclose your loan. Accordingly, make an informed decision.
Make the Payment
Pay the outstanding amount and all other dues in a single payment. Ensure that you utilise only authorised and approved methods of payment to ensure your compliance with the lender’s requirements and policies. Some of these usually include NEFT, RTGS, bank transfer, net banking, etc. This will help streamline the foreclosure process.
Collect the No Objection Certificate (NOC)
Once the preclosure is completed, KreditBee will issue an NOC. This document acts as proof indicating that your loan has been fully repaid and that the account has been closed. It is important to safely store the NOC as it can be used as legal proof in case of any disputes.
Following the foreclosure, ensure that the ‘Closed’ status is visible against the loan account on your credit report. This change must be updated in your report within 30 to 45 days after the preclosure is completed. In case this does not happen, raise a complaint with the respective credit bureau to ensure that accurate information is reflected in your report and score.
Some benefits of preclosing your KreditBee Personal Loan are as follows:
Save on Interest Costs
Eliminate future interest charges by prepaying your loan. This helps reduce the overall cost of your borrowing and boosts your financial stability.
Reduce Monthly Obligations
Preclosing your KreditBee Personal Loan helps lower your monthly debt obligations, enabling you to direct more funds towards the repayment of other loans.
Improve Your Debt-to-Income (DTI)
Foreclosures help reduce the DTI ratio which improves your eligibility for other credit options. A low DTI of less than 30% can help you get easy approvals on your new credit card or personal loan application.
Alongside these advantages, there are some cons of opting for a preclosure which you should be aware of. These include:
Utilisation of Savings
Using the funds from your savings and investment accounts to foreclose a loan can affect the availability of emergency funds. This could result in financial difficulties when you urgently need liquid assets or readily accessible cash savings.
Missed Investment Opportunities
Instead of using savings for preclosure, you could invest the money in options like fixed deposits or mutual funds, which may offer better returns.
Lower Credit Score
Initially, when you opt for foreclosure and close your loan account, it reduces the number of active credit accounts. This affects the length of your credit history, which is usually considered by most credit bureaus as an important factor when calculating your credit score. Thus, your CIBIL score may lower temporarily when you preclose your loan.
Before you foreclose a loan and during the process, here are some pointers to keep in mind for a smooth and seamless preclosure:
Compare the applicable charges and the potential savings when preclosing a loan to assess whether the foreclosure is actually beneficial to you
Check all the pending dues, accrued interest, outstanding loan amount, and applicable charges to get a complete understanding of the total amount you need to pay
Be sure to get the No Objection Certificate (NOC) from your lender. It serves as proof of you having closed your loan account with no dues pending.
The foreclosure details should be updated in your credit report within 30 to 45 days of the process being completed. If it is not updated, contact the respective credit bureau and raise a complaint to ensure that the report reflects accurate information.
If you have any further questions or concerns, you may contact KreditBee’s customer service team through any of the following mediums:
Address of Head Office: KreditBee, 16/3, Adarsh Yelavarthy Centre, (Opp to Frank Anthony School), Cambridge Layout, Jogupalya, Bangalore, Karnataka 560008
Phone number: 080-44292200
E-mail ID: help@kreditbee.in
