what is foreclosure letter?

Many people borrow housing loans to purchase their dream homes. After that, they begin paying EMIs on those housing loans monthly. However, sometimes they’re able to arrange enough money to repay the outstanding loan amount in full without paying further EMIs. This is referred to as Home Loan Foreclosure. The first step of the home loan foreclosure process is to submit the letter for foreclosure of loan to the bank.

A home loan foreclosure letter is written to the bank in which you are requesting the home loan foreclosure. You’ll also need to provide the loan account details, such as the account number, the foreclosure date, etc. You will also have to mention the reason behind the closure. After that, you’ll need to send the letter to the bank for the foreclosure.

Some people find it hard to write a bank foreclosure letter. To make it easier for them, I am writing a sample in this answer. If you have to write a home loan foreclosure letter to the bank, then you can refer to this sample:

#56 Arya Samaj Road

Uttam Nagar, New Delhi-110059

To

The Branch Manager

Punjab National Bank

#02 Uttam Nagar Branch

New Delhi-110059

Subject: Request for Home Loan Foreclosure

Dear Sir/Ma’am,

I am Manoj Rajpal, and I currently have a housing loan against my account number 523583289099. I want to pay the outstanding amount in a single payment to foreclose my housing loan this month.

I’ve paid 10 EMIs as of now, and 2 EMIs are pending until this year.

I request you to inform me of the remaining housing loan balance that I need to pay to foreclose my housing loan, as well as the complete housing loan foreclosure process at your bank.

I am sharing my contact details below, so please feel free to contact me if you have any queries:

Mobile no.: 94565XXXXX

E-mail address: manoj********@gmail.com

Thanking you

Yours sincerely

Manoj Rajpal

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I hope I cleared all your doubts regarding the letter for foreclosure of loan.

The prepayment process allows everyone to repay the loan in a lump sum amount instead of paying in EMI is called a home loan foreclosure. With this method, a borrower can save on the total loan liability. Since I have explained about the foreclosure process in home loan let us understand what is foreclosure letter.

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A home loan foreclosure letter is a letter addressed to the lending branch manager which has all the personal details of the borrower. Under this procedure, the applicant is required to provide the funding source along with other information of the financial institution with which you are to maintain an account to be utilized for such payment.

How to obtain a loan foreclosure letter from bank?

1. Firstly you need to write an application to the lender regarding the foreclosing of the loan. You need to enclose the existing home loan account number, copy of PAN and copy of address proof in the application.

2. Once the lender receives the application form the amount you need to pay will be calculated till the date of foreclosing. They will inform you about the amount you have to pay and you can pay it by cheque or online transfer (NEFT or RTGS).

3. You need to pay some charges to foreclose your account. Although for foreclosing no bank can levy penalty charges.

4. You need to show documents such as title deeds and other documents related to property within days of foreclosing.

5. Also, you need to provide the no-dues certificate along with the required documents.

This is how you obtain

foreclosure statement.

I hope you now understand what is foreclosure letter.

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