While most of the reputed financiers offer their finances via a few quick steps, the life-cycle for the same comprises two significant parts –
- Approval of loan.
- Repaying loan amount.
It is followed by the closure of this loan that is documented and validated by a NOC letter from the lender’s end.
What is NOC?
No Objection Certificate in the case of loans is a legal document stating that the borrower in question has repaid his/her outstanding dues. It completes a loan cycle, and there are multiple reasons as to why NOC document is needed –
- There are chances of facing a legal challenge.
- Your credit score can take a hit.
- There could be subsequent financial losses.
This document is all the more a mandate for those availing high-value finances like home loans wherein the involved loan amount is substantial, and so are the legal-financial vulnerabilities. It saves you from fraud cases wherein the financial firm in question files a lawsuit for non-payment of your outstanding amount.
How to avail an NOC?
The prerequisites to avail NOC letter are nominal – borrowers need to pay all of their outstanding dues. With that covered, the steps to avail a No Objection Certificate are specified as below –
Step 1: Write a letter addressed to your lender requesting for –
- Copies of invoice.
- Original documents.
- No Objection Certificate
Step 2:
- For unregistered mortgages – Same as above.
- For registered mortgages – Visit Registrar of Property office with a representative from your lender and get the lien removed before asking for your No Objection Certificate.
In brief, a No Objection Certificate is a mandate in cases of borrowers looking to close their loan, considering they want to avoid any possibility of discrepancies or legal hassles. An NOC is mandatory for any loan closure process, including home loans or personal loans.