Axis Bank provides you a lump sum amount of up to INR 40 Lakh with its loan product. And in this, the bank doesn’t ask for collateral. If you have borrowed money from Axis Bank under this product and are having trouble paying the EMIs, get rid of the interest payments through the bank’s prepayment facility. In this what you need to do is pay the balance principal amount in a lump sum. By doing so you don’t have to pay the interest anymore and the loan account closes. Know about this facility for Axis Bank Personal Loan in the article below.
Foreclosure Charges for Axis Bank Personal Loan
On the loan outstanding the bank charges the following fee –
- 5% of the loan balance if the foreclosure is within 12 months of loan disbursement
- 4% foreclosure charge during 13 to 24 months
- 3% for 25 to 36 months
- 2% for prepayment after 36 months
So while computing your savings do add the prepayment fee. By doing so you will know what will be the exact amount you will save from this.
How to Plan the Closure of Axis Bank Personal Loan?
In this, you can take help from the Axis Bank online tool called EMI calculator. This helps you know the loan balance after each year’s payment. With this, you get the idea of the lump sum amount that you need. Now that you know about the loan balance, start choosing the investment products. Because this is the only way to save a lump sum amount in a short period.
There are products like fixed deposits, recurring deposits and mutual funds that could help you grow money. So by the time you reach the foreclosure date of the Axis Bank Personal Loan, you will have sufficient money to pay off the loan balance.
Illustration of Axis Bank Personal Loan Prepayment
With the help of the example below see how the prepayment is done for an Axis Bank personal loan.
Sagar borrowed an Axis Bank Personal Loan of INR 8 Lakh at an interest rate of 12.00% per annum. And the tenure he chose is 5 years. He has completed a year from the tenure, so it means four years are left. And at the end of the year, the loan balance is INR 6,75,767. The total interest is INR 2,67,733 out of which Sagar has paid INR 89,315. So the remaining balance of interest is INR 178418.
With prepayment, he can skip the remaining balance of interest. So after getting this information from the EMI calculator he starts collecting the lump sum amount so he can pay off the loan. He took money from FD, mutual funds and other investments and was successful in gathering the money.
His loan is closed now and there is no interest payment left. So the daily spending is managed without any trouble in his regular income.
If you learned about the process from this example, do the same for your loan.
What to do Post Loan Closure?
When you paid the loan balance, visit the bank branch afterward to collect the no-objection certificate (NOC). This is an important document that can help you in the long term. In case due to some technical error, the bank isn’t able to send your loan closure report to the credit bureau and this results in a poor score. But as you have the NOC, you can prove that the loan is closed with full payment. So, the score will be corrected and you can maintain a healthy record. So if you are thinking about doing a loan closure, don’t forget to use the Axis Bank Personal Loan EMI Calculator. With the help of this, the prepayment can be convenient.
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