Understand the terms related to pre-closure of your PaySense Personal Loan, such as charges, requirements, and process.
PaySense allows you to close your personal loan early, provided you have completed a minimum number of EMI payments. Preclosing a loan can help reduce overall interest costs, but it may involve certain charges. Before proceeding with the PaySense Personal Loan preclosure, it is advisable you check the applicable charges to make an informed decision.
If you decide to preclose your PaySense Personal Loan, you’ll need to meet certain criteria and pay the applicable charges. You must pay at least 3 EMIs in order to be eligible for preclosure of the loan.
Additionally, a foreclosure charge of 4% of the outstanding loan amount, along with GST, will be applicable. The exact charges may vary based on the remaining loan amount and the number of EMIs already paid.
Before preclosing your personal loan, you must meet certain requirements. These conditions ensure that the preclosure process is valid and processed without complications.
Here are the key requirements:
Minimum EMI Payments
You must have paid at least 3 EMIs before applying for preclosure
Foreclosure Application
A formal request must be submitted to the lender, mentioning your loan account number and personal details
Approval from Lender
The lender must approve the preclosure request before proceeding with the final payment
Payment of Outstanding Amount
You need to clear the remaining principal along with applicable foreclosure charges by the specified due date
Follow these steps to complete the personal loan preclosure process:
1. Contact Your Lender
Get in touch with PaySense customer support to request preclosure. You may need to submit a written application, including your loan account details and personal information.
2. Get Approval for Preclosure
The lender will review your request and calculate the outstanding balance, including the principal amount and applicable foreclosure charges
3. Make the Payment
Once you receive the final settlement amount, ensure you pay it within the given timeframe to complete the preclosure process
4. Obtain the No Dues Certificate (NOC)
After payment, request a No Dues Certificate (NOC) from PaySense. This document confirms that your loan is fully closed and no further dues remain.
Preclosing a personal loan can offer financial relief, but it also comes with certain drawbacks. Before making a decision, weigh the pros and cons to determine if it suits your financial situation.
Advantages of Preclosing a Personal Loan
Reduces Debt Burden
Paying off a loan early eliminates monthly EMI obligations, providing financial relief and reducing stress
Saves on Interest Costs
By clearing your loan before its tenure ends, you reduce the total interest payable, leading to significant savings
Improves Credit Score
Timely preclosure reflects responsible financial behaviour, positively impacting your creditworthiness
Shortens Loan Tenure
Early repayment accelerates financial independence, allowing you to focus on other financial goals
Optimises Fund Utilisation
Using surplus funds to close a loan can improve financial security and cash flow management
Disadvantages of Preclosing a Personal Loan
Foreclosure Charges Apply
Lenders typically impose a foreclosure fee
Lock-in Period Restrictions
Some lenders enforce a lock-in period, preventing preclosure until a set number of EMIs have been paid
Potential Loss of Tax Benefits
If the loan was eligible for tax deductions, preclosing it may reduce your overall tax savings
Impact on Liquidity
Using a lump sum for preclosure can reduce available funds for emergencies or investments
If you plan to preclose your personal loan, certain factors can help you avoid unnecessary costs and ensure a smooth process.
Check Foreclosure Charges
Most lenders impose a foreclosure fee, which varies based on the outstanding amount. For PaySense, this charge is 4% of the remaining personal loan amount.
Verify the Lock-in Period
Some lenders require you to complete a specific tenure, such as 3 months to one year, before allowing preclosure
Compare Total Payable Amount
Calculate the remaining EMIs if you continue with regular payments and compare them with the foreclosure cost to determine the better option
Look for Seasonal Waivers
Occasionally, lenders waive foreclosure charges during special promotions. Monitoring such offers can help maximise your savings.
Obtain a No Dues Certificate (NOC)
After preclosure, request an NOC from the lender to confirm that your loan is fully closed and no outstanding dues remain
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