Learn about the preclosure process for your Upwards Personal Loan in detail, including applicable charges, and minimum repayment requirements.
Closing your personal loan before the end of its tenure can help you save on interest payments. Upwards allows preclosure after a certain number of EMIs, subject to specific conditions. These include a minimum repayment period before preclosure is permitted, charges based on the tenure completed, and possible capping on the preclosure amount.
Before opting for preclosure, it is essential to check the applicable charges and other criteria associated with the process.
Preclosing an Upwards Personal Loan is subject to specific conditions and charges. Borrowers can opt for pre-closure only after completing a minimum number of EMI payments and meeting the required tenure criteria.
The outstanding loan amount must be repaid in full at the time of pre-closure, along with applicable charges. Upwards levies a 5% foreclosure charge on the outstanding loan amount, with additional GST or taxes as per government regulations.
For further details on pre-closure charges and process, you can contact Upwards' customer support or refer to your loan agreement.
Preclosing a personal loan can be beneficial, but it also comes with certain drawbacks. Understanding both aspects can help you make an informed decision.
Advantages
Interest Savings
By repaying your personal loan early, you reduce the total interest paid over the loan tenure
Improved Credit Score
A successfully closed loan with full repayment can positively impact your credit score
Reduced Financial Burden
Eliminating an EMI reduces monthly expenses, allowing better financial management
Increased Loan Eligibility
With no outstanding debt, you may qualify for other loans with better terms in the future
Disadvantages
Foreclosure Charges
Lenders typically levy a foreclosure charge, which may offset potential savings on interest
Reduced Liquidity
Using a large sum to close the loan early might impact your cash reserves
Limited Benefit in Later Stages
If most of the interest has already been paid in the initial EMIs, pre-closure may not result in significant savings
Before proceeding with pre-closure of your personal loan, consider the following steps to ensure a smooth process:
Check Pre-closure Eligibility
Verify if your lender allows pre-closure after a minimum number of EMI payments
Calculate Foreclosure Charges
Understand the applicable charges and ensure they do not exceed the potential savings on interest
Arrange for Full Payment
Ensure you have the required funds to repay the outstanding loan amount, including charges and taxes
Obtain a Loan Closure Certificate
Request a No Objection Certificate (NOC) or loan closure confirmation to update your credit report
Verify Credit Report Update
Check your credit report after a few weeks to confirm the loan closure is reflected accurately
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