SBI Bank is India’s leading provider of personal loans. The massive network of SBI Bank offices stretches across India, and this is arguably one of the main reasons why SBI has such a broad customer base. The SBI bank offers world-class customer care and quick processing of SBI Personal Loan.
Pre-closing SBI Personal Loans is also made easier by the bank. You have a variety of options when it comes to prepaying your debt, whether you want to pay it off in full or in installments. Borrowers can easily make a preclosure request at any time throughout the loan’s term.
What is Pre-Closure, and how does it work?
A personal loan is prepaid or pre-closed when the entire loan amount or a portion of the loan is repaid before the loan’s initial due date.
You can save a lot of money on your loan interest if you pay it off early. Most banks have a pre-set lock-in period during which you will not be able to prepay your loan. You can repay your loan early once this period has passed and you have paid a particular number of EMIs (as determined by your lender). When you have a large sum of money in your own bank account, you can do this. You can use these extra earnings to pay off your personal loan sooner.
Pre Closing Charges for SBI Personal Loans
- You will be charged 3% on the amount prepaid as SBI personal loan prepayment charges if you choose to prepay your SBI Personal Loan in part or in full.
- SBI does not charge preclosure fees if you plan to pay off or close your personal loan with the proceeds of a new personal loan under the same scheme.
How to Apply for a Pre-Closure SBI Personal Loan
- You must first notify an SBI bank representative by phoning their customer service centre, sending an email, or visiting any SBI branch. Always be clear about your thoughts and communicate to the bank about your preclosing plans.
- You’ll need to talk about your plans to pay off your SBI Personal Loan early and learn about the fees you’ll be charged. It is necessary that you are knowledgeable about the entire fees or charges before going for pre-closing. Analyse whether it is profitable for you to preclose your loan or not and proceed accordingly. Clear out everything on a prior basis to avoid any disputes further.
- For the pre-closure procedure to begin, you’ll need to maintain appropriate documentation on hand. Be prepared with your documentation to go for a hassle free procedure.
- After you’ve finalized everything and the bank has allowed you to initiate your preclosure, you’ll need to pre-close your loan in full or in parts.
Documents Required for Personal Loan Pre-Closure
To pre-close your SBI personal loan, you’ll need the following documents:
- Loan Account Statement
- Valid Photo ID
- To make the payment, you’ll need a cheque or a draft.
The Bottom Line
If you decide to pay off your personal loan early, keep in mind that your lender may charge you a penalty for doing so. Before you begin the pre-payment method, you should verify with your lender about this. This penalty may be greater than the amount of interest that you will save on your personal loan. It is preferable not to prepay your debt in such circumstances.
It is also important to look for the best offer in the market and search for the most affordable interest rates. You will be able to get the offer of best SBI personal loan interest rate if you have a good CIBIL score. Always realise the importance of a good credit score when obtaining an unsecured loan.