After repaying the loan, obtaining an NOC (No Objection Certificate) is crucial because it serves as proof that your loan has been fully cleared. Not obtaining it can lead to various complications.
Everyone dreams of owning their own home, so people often seek housing loans to fulfil this dream. However, after taking a loan, it’s essential to repay it, including the interest. But once you’ve completely repaid the loan, don’t forget to obtain an NOC from the bank. An NOC certifies that your loan is now closed, and you don’t owe the bank any outstanding amount. If, for any reason, you overlook obtaining this certificate, you might encounter several future hassles. Let’s understand why getting a No Objection Certificate is so important.
Not obtaining an NOC can often result in your loan not being entirely closed, directly impacting your credit score. The pending loan amount may continue to be displayed on your credit report, potentially hurting your credit score. This can create difficulties when applying for housing loans or personal loans in the future.
Late Fees May Apply:
In the absence of obtaining an NOC, the lender may not be aware that your loan has been closed, leading to late fees and additional interest charges accumulating. This can make repaying the loan more challenging in the long run. Many times, lenders forget to update the details regarding loan repayment, which can lead to disputes. To avoid such situations, obtaining an NOC is essential.
Property Negotiations Could Be Affected:
If the loan you’ve taken is associated with a property in any way, not having an NOC can cause complications during property negotiations. It can even stall the sale of the property, as the property’s ownership cannot be officially transferred without the lender’s claim being officially cleared through an NOC.
In conclusion, obtaining a No Objection Certificate after repaying your loan is not just a formality; it’s a crucial step to ensure that your financial affairs are in order and to avoid any potential future complications.