How To Foreclose Your Car Loan

Car loan foreclosure involves repaying the full outstanding amount before the scheduled tenure ends. Before proceeding, check the foreclosure amount, applicable charges, potential interest savings, closure process and documents required after repayment.

• Check the foreclosure amount and applicable charges through My Account or the Bajaj Finance app.
• Review your loan agreement, outstanding dues and remaining tenure before deciding on early closure.
• Complete the full foreclosure payment through an authorised channel and confirm the loan closure status.
• Obtain and retain the applicable NOC, closure confirmation, payment records and vehicle-related documents.
• Check your credit report and vehicle records after closure to ensure the relevant details are updated correctly.

Car loan foreclosure means repaying the full outstanding amount of a car loan before the scheduled tenure ends. Instead of continuing with the remaining EMIs, the borrower pays the amount required to close the loan account in full. The foreclosure amount may include the outstanding loan amount and applicable charges shown for the account. The exact amount depends on the loan account, repayment position and terms applicable to the borrower. Review the loan agreement to understand the conditions and applicable charges for early closure before proceeding. Foreclosure is different from part-prepayment. Part-prepayment means paying a portion of the outstanding principal, while foreclosure involves paying the full amount required to close the loan. If you are considering foreclosure because you have surplus funds, compare the amount payable for early closure with the interest that may otherwise accrue over the remaining tenure. This can help you assess whether closing the loan early suits your financial requirements.

How can you check your car loan foreclosure amount?

You can check your car loan foreclosure amount through My Account or the Bajaj Finance app, depending on the services available for your loan account. Reviewing the amount shown before payment helps you understand the amount required to close the loan, including any applicable charges.

Through My Account

1. Sign in using your registered mobile number and OTP.
2. Verify your details using the requested information, if applicable.
3. Go to Service and select the relevant loan under Your Relations.
4. Select Make Loan Payments.
5. Choose Full Payment/Foreclosure, where available.
6. Review the foreclosure amount and any applicable charges displayed for your loan.
7. Proceed with the payment if you decide to foreclose the loan.

Through the Bajaj Finance app

1. Sign in to the Bajaj Finance app using your registered mobile number and OTP.
2. Access the relevant loan account from the available loan or service section.
3. Select the option for making a loan payment.
4. Choose Full Payment/Foreclosure, where available.
5. Review the foreclosure amount and any applicable charges displayed for the loan.
6. Proceed with the payment if you decide to close the loan.

The exact options and screens may vary based on your loan account and the services available to you. Check the foreclosure amount displayed for your account before making the final payment. Login to your account now

To foreclose your car loan, review the loan terms, confirm the final amount payable and complete the full payment through an authorised channel.

Follow these steps:

1. Review your loan agreement
Check the terms applicable to early closure, including any foreclosure conditions or charges.
 

2. Check your outstanding loan amount
Review the current loan balance and identify any overdue amount or other applicable dues that may need to be cleared.
 

3. Check the foreclosure amount
Use the available My Account or service portal option to view the amount required for full closure. This provides a more accurate figure than calculating the amount yourself.
 

4. Review applicable charges
Check the charges displayed for your specific loan before confirming the transaction. Do not assume that the same charges apply to every car loan.
 

5. Make the full payment
Complete the required payment through the authorised payment facility.
 

6. Confirm loan closure
After the payment is processed, check the loan account and retain the foreclosure or closure confirmation for your records.
 

7. Obtain applicable closure documents
After closure, check the available documents, including the No Dues Certificate (NOC) and other documents relevant to the vehicle or loan account.
 

Completing the payment alone should not be treated as a substitute for checking the loan status and obtaining the relevant closure records.

What charges apply when you foreclose a car loan?

Car loan foreclosure may involve applicable foreclosure charges and other outstanding amounts depending on the loan terms.

The amount payable can include:

• Outstanding loan amount: The amount remaining to be paid under the loan account.
• Foreclosure charges: Charges applicable for closing the loan before its scheduled tenure, where applicable.
• Overdue amounts: Any pending instalments or other dues shown on the account may need to be addressed.
• Other applicable charges: Any charges specified in the loan agreement or displayed during the foreclosure process.

The exact charges should be checked against your loan agreement and the amount shown for your account. Do not rely on a standard percentage or an estimate from another loan account, because applicable terms can differ. A foreclosure decision should therefore consider both the cost of early closure and the potential interest savings from not continuing the loan for the remaining tenure.

Foreclosing a car loan can reduce the remaining interest outgo, but the decision should be based on the foreclosure amount, applicable charges and your available funds. Early closure may be worth considering when you have sufficient funds to repay the loan without affecting essential financial needs. The potential saving is generally related to interest that would otherwise accrue over the remaining tenure. However, applicable foreclosure charges can reduce that saving.

Before proceeding, consider:

If foreclosure would leave you without sufficient funds for other important financial commitments, continuing the scheduled repayments may be worth considering. Review your loan details and applicable terms before making the decision.

What should you do after foreclosing your car loan?

After making the foreclosure payment, confirm that the loan account has been closed and retain the documents issued for the completed repayment.

You should check:

• Loan status: Confirm that the account reflects the completed closure after the payment has been processed.
• No Dues Certificate: Download or obtain the applicable NOC or No Dues Certificate when it becomes available.
• Vehicle-related records: If the loan created a registered charge or lien against the vehicle, check the applicable process for removing the lender's interest from the vehicle records.
• Payment records: Keep the final payment confirmation, closure communication and relevant loan statements for your records.
• Credit record: Check your credit report after closure to ensure the loan account information is reported correctly.

The documents and vehicle-related formalities may vary depending on the loan and registration records. These may include an NOC, loan closure certificate and documents related to removal of the lender's interest, where applicable. Foreclosure should be treated as complete only after the payment is processed and the loan account reflects the appropriate closure status.