Closing a car loan

As much as it is important to know about the steps and details on applying for a car loan, it is also equally important for us to know a few details and step-by-step procedures for closing a car loan. We will look into some of the process and procedure that runs behind on closing a car loan. People usually take up the loan when they are in urgent need of the money or when they want to stabilize a part of their finances. In the same way, a loan known as a car loan is also opted by many of the people across the world to buy a car and make the payments on basis of monthly investments when opted for a car loan. As we have seen that opening a loan account is followed up with certain steps involved, like choosing a bank, submitting the required documents and then the verification process takes place. So similarly, closing a loan account is also a step by step process. And today we are going to see the procedure involved in closing a loan account subjected to that of a car loan.

The process is followed as mentioned below. Let us see the steps involved in closing a loan account with HDFC car loan

1. The first thing to remember is that closing a car loan account doesn’t mean that one can get away without making his or her payments or by piling up the debts. This is not something that the banks or the non-banking financial companies would accept. One should always clear his or her repayment according to the agreed terms and conditions by the bank. So it is clear that the borrower or the customer is allowed to close his or her loan account only when they pay their EMIs accordingly. So, this can be the first step to be followed, that is one should clear all their dues linking to their car loan account and after they are done paying for their last months EMI they can get to gather all their required documents that are necessary for closing the car loan account.
2. The second step involves visiting your respective bank that is the HDFC bank as we have taken this one as an example. Now all you have to do is to submit a form that mentions the closure of the car loan account yours. The bank then verifies to cross-check all your payments whether they are up to date or not. Once you are clear and have no due in any of your payments or if there are no pending payments to be made, the bank issues a certificate with states No Dues. One more thing, you should take responsibility by filling a form for the closure of the car loan account and submitting a copy to the Regional Transport Office which is nothing but the RTO.
3. Since you are about to close your car loan account, you should remember to remove the lender's name before you close the account ones for all, so that this will no longer remain to be an active account. Now, these copies of the lenders are also to be submitted to the Regional Transport Office. They will be further verifying all the details of the lender to make it clear. Now the Regional Transport Office will be issuing the borrower with a new updated card which states that the activation has been canceled and no longer is in the name of the lender. You can then be allowed to obtain your insurance policy which will state your name. 

You can now be able to check the credit history and score that will be updated. And your lender will also be informed regarding the closing of your car loan account. In case you find that the credit report of yours is still not updated even after 60 days of the time, immediately take responsibility by informing the loan officer and get things done accordingly.

Also Read:- Calculating before Applying for a Car Loan