Why you should collect NOC (No Objection Certificate) once your loan is complete ?

POSTED BY manish ON September 11, 2014 COMMENTS (103)

Once you pay off your loan, a big responsibility is off your mind and you feel relaxed. Its a moment where you do not want any further run around and want to now move on to other things in life.

And this is exactly why most of the loan customer do not collect a document called “NOC” or “No Objection Certificate” from their lender and it can get them into trouble later in life. At some places you will hear the word “No Dues Certificate” , but generally most of the executives in real life use the word “NOC” only

Read the incident below to understand its importance

importance of NOC No objection certificate

What is NO Objection Certificate (NOC) ?

With reference to loans, An NOC or No Objection Certificate is a legal document provided by the lender which states that the loan has been complete and their is no outstanding to be paid by the customer as on a specific date. Whenever a person pays off a loan, its important to take this NOC document from your lender.

How to get the NOC ?

Generally, all the lenders dispatch the NOC document to your registered address once your loan is complete. However at times, people do not pay attention to it and loose out on it for some or the other reason. Also if the registered address with lender is your old address (suppose you changed the address in between the loan), then also you will miss the NOC document.

So if you do not get the NOC, better contact your lender and ask for it specifically.

What kind of problems can happen if you dont have NOC ?

A lot of people think that just because the EMI’s are paid off fully, the job is done. However its extremelly important to have a legal document with you which clearly states that you do not owe anything more to then lender.

This way you are protected legally and if someone claims later in life that you owe more to the lender, you can produce the NOC if required. I would like you to have a look at the incident below which create some issue for one of the loan customer, who had paid off the loan, but didnt have the NOC with him

Hi Manish,

I have taken a personal loan from Bajaj Finance in the year 2004. All along, I have been thinking that I have paid the loan. To this effect, Cibil report also says, there is no balance outstanding and the account is closed on 31.12.2008. I don’t have NOC.

Today, I have received a call from a Lawyer saying that he has a summons to arrest me and I need to pay the balance amount of Rs.3750/- and that too I need to pay before 3 pm.

Could you please responds me as to what should I do. My question is will he really have Summons or just he is threatening. I can pay, but he is asking me to pay beofre 3 pm. That’s what I am not able
understand.

Here is another incident where Rahul settled his outstanding credit card dues with Standard Chartered bank and didnt collect the NOC . Then after many years he got a notice from the bank to pay 7.7 lacs. Here are his comments

Its been 12 years now, and I dont have the copy of NOC (or No Dues Certificate) with me. How do I prove my case as SCB isin’t ready to check me credit card history to see where the problem was. They just keep saying “they can’t retreive the information as they have sold those accounts to saha finlease.

And what about the notice they sent me asking me to attend conciliation camp to be held on 11th November?

Read the full incident on our forum

How NOC can help you in future if some problem arise

NOC is a legal document which has weightage . It proves that you really have paid off the loan fully and if there is any confusion, then NOC solves it.

Read these two incidents which were shared on our forum and you will understand its importance

Dear Manish,

Same problem as Sandesh I had with Indus Ind Bank Kolkata recently. They told me that my score is very low so they are not considering me. However, I submitted them my CIBIL Report which clearly says 763. There was an issue with a credit card which I cleared 1 year back.

I submitted them the NOC too. The HR here told me that she has forwarded the details to her central office. Now I am waiting to hear from them.

(Source)

Dear Ravish,

If you have the NOC issued by the bank, saying all dues have been cleared and there is nothing pending, you can get a loan. But as Dear Ashal has suggested file dispute with CIBIL and wait for 2-3 months to get it rectified.

I had the same experience about 3 years back and credit card in question was issued by HSBC. I got the NOC issued by HSBC and applied for loan with HDFC, while submitting the application I informed HDFC about the HSBC story. Later on, HDFC asked for the NOC and cleared my loan.

(Source)

Go get your NOC right now

So now, if you had any loan in past which you have completed and paid off, make sure you have applied for the NOC and keep it safely in your records

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103 replies on this article “Why you should collect NOC (No Objection Certificate) once your loan is complete ?”

  1. Elavazhagan says:

    Hi Manish,
    I had closed two credit cards on 2009 with some waiver and not got any NDC/NOC that time. But when I check my cibil report now, those tow cards are saying the status of “settled” [With 0 balance]. Because of this I can’t able to get the housing loan now, even though my cibil score is more than 800. How can I solve this issue.

    1. You need to check with the lender on why they updated the status as SETTLED and not CLOSED.

      I hope you did pay the full outstanding amount and not the less amount.

  2. DEVPARWAR says:

    Hi Manish,

    i have taken two wheeler loan in 2012 & i did not pay last 12 emi’s bcz the vehicle condition was very bad. I returned that vehicle to the Financier but the case is not solved till now as i have not taken NOC from them due to which my CIBIL Score is 600 & my loan application rejects every time. Now i am going to take NOC from the Financier & will be submitting to my bank.
    After submitting NOC of my pending loan will they provide me loan ?
    OR
    will my cibil score increase ?

    1. I dont think it will solve any issue. Unless you pay the loan, its going to be tough !

  3. aryav says:

    i had a one time loan settlement with uco bank where they waived of lacs of rupees and they issued a no objection certificate
    In future can they ask for remaining money ?

    My Noc document will help me to fight in future ?

    1. Yes, they will not ask for money. But thats all ..

      They are still free to report it to CIBIL with bad remark.

      Manish

  4. Ashish Singh says:

    Hi Manish ,

    In July 2015, I took loan but i was not able to pay some EMI’s on time but instead of settlement , paid whole amount in Oct 5 2016 and got NOC. But when I applied for credit card on Oct 15 , it got rejected . How can i apply for credit card and what should i do now.

    1. First apply for your CIBIL report and see if there is any remark in that report ?

  5. Harish says:

    Hi Manish,

    I’m Harish.. Actually in the 2013 took vehicle loan and cleared it in the year 2014 by paying in EMI.. Also collected the cheques given to the bank.. But at that time, bank didn’t give me NOC.. Also I didn’t knew at that time I have to get that document.. But today 2016 they’ve sent message asking to pay 5k inorder to get NOC.. Is it the correct way for the bank to suddenly after 2yrs without any communications in last 2 years.?

    1. No , they cant charge you just to give NOC. Complain about this with RBI and banking ombudsman

  6. Rahul says:

    Hi,

    I recently paid off my educational loan from SBI to a private ARC. I have received the NOC for the same as well. But I think my SBI account is still frozen. What steps do i have to take to further? Also we can use the electronic copy of NOC right?

    1. Hi Rahul

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that

      Manish

  7. obliged says:

    hi
    i defaulted on my credit card payment and it was fully paid off june 2015 but till today HDFC hasnt removed my name of cibil and neither are issuing a noc letter. i have contacted customer service and they asking me to contact collections and when i call that phone no they never answer. i have also moved to a different state and currently live in mumbai. can someone guide me how i can get this resolved. the credit card was paid in full including all fees as they froze my account for five months and took all the money and were not ready to settle.

    1. You need to check with HDFC, why they have no updated it with CIBIL

  8. skumar says:

    Hi

    I had used HDFC Bank 2 wheeler loan 6 year ago. i have paid all the emi , but haven’t got any NOC till date on my address. Will they provide it after such long time.

    Thanks

    1. Yes they will provide it

  9. SRINIVASAN says:

    Hi Manish

    I’ve credit card from HDFC bank but still now I’ve not used it. I’m planning to surrender my credit card. Pls suggest what documents should we get from them once the card is surrendered. Thanks in advance

  10. EUGENE says:

    HEY I PAID MY ALL EMI NOW THEY ARE ASKING FOR EXTRA 1259 FOR CHARGES I DONT KNOW COMPANY
    BAJAJ AUTO FINANCE

    1. Hi EUGENE

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that

      Manish

  11. veena says:

    Hi i am veena
    today i apply NOC for my land (site) and also request to verify the documents and sample of the documents, so
    how much time it will take.

    thank you

    1. Hi veena

      Thanks for asking your question. However we do not have answer to your question.

      Manish

  12. Sindhu says:

    Hi,

    my loan accounts has been closed , and now I want my NOC to get. please let me know the procedure for the same.

    1. Just ask the company for it. They will give it

  13. Nitin says:

    Hi Manish,

    I have made my credit card payment recently which was due for last 1year.

    I got my NOC letter.

    But a private financer told me that whether you make settlement or NOC, it does not matter, in both the cases you will not be eligible for taking loan again from bank as you given money back because of bank pressure and they will not give you loan again.

    Please let me know is it correct that bank will not give me loan after getting NOC.

    1. Finally its a bank decision if they want to give loan or not. Think from the bank point, if you had given back the money only after consistent pressure, then why will bank take the risk of giving loan to you again ?

      However, you might get the loan from other banks .

      SO better try other banks.

      Manish

  14. Jagruti says:

    Hi Manish, one of my relative has taken home loan jointly with his father. Unfortunately his father passed away. Now remaining amount is less and he can pay in one go. But bank is not ready to give NOC as they required signature of both co owners. Please suggest what to do in this case.

    1. What is the bank saying when you tell them that one of the owners is no more?

    2. Sanoj says:

      Hello,
      Please share the bank details and show them on them on the public. How a bank person can ask such a foolish question.. Hope they need a copy death certificate and it should gets closed.

  15. naveen says:

    Hi Manish,
    I have settled my hdfc credit card payment in jan-2014 but still not received any kind of NOC please suggest me steps to take noc from hdfc bank?
    or any helpline no to complain such things?
    Please suggest me all possible ways to get NOC from HDFC bank (credit card)

    1. You can reach out to HDFC bank and ask for NOC

  16. Arul says:

    Hi Manish,
    Have seen this article long before and I was waiting to apply for my NOC availed on COC on my credit card from Citibank. The CC told that the bank has not asked any doc on my side on availing loan then why I should need the NOC. But upon insisting that I want to be on the safer side he registered my query and sent a email copy today. It was just stating that I have completed the loan. I have a doubt if it is a NOC. Could you please clarify.

    Dear Customer,

    Card #xxxxxxxxxxxxxxx

    This is with reference to your recent contact with us. Please find below the details of the loan availed by you.

    Reference Number : 6xxxxxx
    Loan amount : 220,256.00
    Booking Date : 05-11-2012
    Tenure : 36
    Rate of Interest : 15
    Equated Monthly Installment (EMI) : Rs. 7,635.00 /-
    Total Principal paid : 220,256.00
    Total Interest paid : 52,585.00
    Closed date : 13-10-2015

    For any further assistance, we urge you to henceforth write to us only through our secured internet banking platform.
     

    1. No , this is not NOC . NOC is a document which comes to you which mentions clearly that you have competed the loan and now no outstanding remains.

      1. Arul says:

        Thanks. Will contact bank.

  17. karthikeyan says:

    Hi Manish,

    Am planning to go for One Time Settlement with bank for my education loan.
    If I negotiate and settle the account, will if affect my CIBIL score?

    Kindly advise.

    1. Yes, for the amount you do not pay , it will be treated as NOT PAID and you will be mostly marked as defaulter. I suggest when you talk to bank on this, ask them clearly what would be they updating in CIBIL and take it from them in writing

  18. Bhushan says:

    Hello Manish,

    Very informative Article, I recently paid off 25L of Home Loan amount to Axis and got it transferred to Canara Bank
    Currently I am awaiting the documents from Axis Bank which i will submit to Canara, So in my case apart from NOC,
    Do i need to ask anymore documents from Axis Bank.

    Thanks & regards,
    BP

    1. Hi Bhushan

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that

      Manish

  19. krishanansh says:

    Hi Manish,
    I am going to pay my total outstanding for credit card after that may I eligible to apply for new credit care with the help of NOC because after completing the payment I will close my old credit card due to some problem.

    s krishanansh

    1. But that will not increase your score instantly . You will have to wait for few months

  20. Stan says:

    Hi Manish,

    I settled my SBI Credit Card payment at 60% of the total standing amount. I have received the NOC as well. Will it have impact on my CIBIL score?

    1. NOC means that your case is closed now and they will not contact you again for that, but that does not mean that they are not reporting you as a defaulter to CIBIL

  21. Chanda says:

    Hi Manish,

    I booked a Cash on Call(COC) loan on my HDFC Credit Card a few years ago. I repaid all the EMIs and the loan was closed in December 2014, but I haven’t received any NOC from the Bank. The Card that I availed COC loan on expired in October 2014 and bank issued me a new card. Should I call bank and request for a NOC?

    One more question, Do we need NOC for the credit card payments using EMI option? Lately, online shopping is catching trend and a lot of users shop online using credit cards and opt for EMI options. Once such EMIs are repaid, should the customer ask for NOC from bank/credit card issuer?

    Thank you!

    1. You need NOC for all the debts you clear. So yes, call them and ask for NOC , you should get it

  22. CarLoanClosure says:

    HI Manish,
    My CAR loan closed 5years before. I had never got my NOC and Form 35. How to get them from Bank now?

    Thanks,
    Sweta

    1. Contact them and give them reference for it like Loan account number. They will send it to you

  23. B NAGARAJU says:

    I have paid tractor loan noc also received,but i have not received my documents (pass books) more than 10 days completed.please give as soon as possible.
    Branch:HDFC HANAMKONDA(Nakkalagutta)

    1. Check with your bank on this

  24. robin says:

    Hi
    My loan is due but i want to clear my all loan amount in few days.they issued noc in how many days after paying ?

    1. It generally takes few weeks !

  25. Basavraj says:

    Hi Manish,

    I closed my credit card back in 2012. And today when i pulled my CIBIL data it also shows the closed date for CC. Do I still need NOC from bank which issues CC to me?

    Cause I did not close the card, but bank did not re-issue when second time card expired. Because I was not using that card at all. Due to which I was not a useful customer for bank. No use…no payment…no deduction for 2 years. So they canceled my CC.

    1. Hi Basavraj

      In any case, collect the NOC

  26. Subash says:

    Sir,
    My brother took vehicle Loan for the year march 2013 to Dec 2014. In this tenure last 8 emis are not paid in due date. It was paid after due date by 10 to 15 days. He settled all his dues and got NOC from bank on Dec 2013. He is going to apply Personal Loan now. Will CIBIL score affect him or not. Is he eligible for PL?

    1. Definitely its going to affect his CIBIL because the DPD sections would be messed up in his case !

      Manish

  27. Senthilnathan V says:

    Anybody have a NOC formart for education loan ? please provide me.

  28. Harsha says:

    Hi Manish,

    Thank you for this great article, This knowledge is really important to all.
    I have 3 questions, it will be great if I could get an answer to this.
    1) I have taken a laptop, books & phone on EMI using my credit card and if I have successfully paid it all off over the years, should I take a NOC for each item ?
    2) If the credit card company has closed a credit card and replaced it with another for the reason that the latter is a premium card or when it has replaced it after the expiry of the credit card should we still get a NOC for the former card that has been replaced ?
    3) As we can get the Persoal Loan/Home Loan/Vehicle Loan off the CIBIL report, can we or should we also get other EMIs for laptop, books & phone off the CIBIL report ? Is it possible ?

    Keenly awaiting response.

    Regards
    Harsha. S

    1. Credexpert says:

      Dear Ma’am,

      Please find below the answer to your queries.

      1) Since you have paid for the laptop, books & phone using your credit card, this will be considered as expenses on your credit card and the same will be reflected in your credit report against your credit card. If you have made all your credit card payments on time this should not be an issue.

      2) In case your card is replaced by a new one either due to up-gradation to a premium one or expiration, you need not ask for an NOC.

      3) All loans and credit facilities taken by you will be reflected on your credit report. However, as mentioned earlier, expenses incurred on your credit card will be reflected in your credit report against your card.

      Regards,
      Credexpert

  29. vijayroshan says:

    Dear Manish, Thank you for this article on such a important issue. i have taken a personal loan from HDFC 3 years back and re-payed the loan, but never thought of getting an NOC because i didn’t know about it but after reading your article i sent a mail to them and within a week i got the NOC. thank you for your great work.

  30. Jagruti Mahajan says:

    Now, abhimanyu knows how to get back from chakravyuh.. thanks to Manish.. 😉

  31. Sangeetha says:

    I have closed my Education loan in Canara Bank, but when I aksed for the NOC they said that they will provide the NOC only if we are going to apply for the another loan in their bank/some other bank. For closing the Loan they said they ill provide only the Closing Statement.. Please help me how to apply for NOC .. my loan amount is 3 .6 lakh.

    1. Its not fair . An NOC has to be given in any case. You cant go back to them when you need it . Contact the grievance cell

  32. KANCHAN says:

    How can we ask bank to provide 1 day of grace period on due date ?? when bank saying they do not have any provision of grace period ?
    I am holding kotak bank saving account and credit card. From past 3 months bank website hags down on my due date and payment going to them in next day..upon my complaint to nodal officer late fee and interest reversed twice by them but 3rd time they r not ready . I am also using other banks credit cards where they r giving 2 days of grace period without any hassle. Like – HDFC,CITI,SBI but when comes to kotak it is worst ever. My payment gone them to next day of due date and interest charged me on total due of 13201/- is 1334 rs. + taxes, there was some amount paid by me before due date which is – 4349/- + last months late fee reversals of 1023/- rs..I am still confuse why have they charged my 10% interest on my total due ??

    1. Hi Kanchan

      You can only get this answer from them . Better complain with Banking ombudsman

  33. Onkar says:

    Do we also need NOC for the case when credit card was deactivated by the bank since it wasn’t in use for quite some time? I got SMS for bank that your card isn’t in use so we’re closing the account to prevent possible misuse.

    1. Yes, even in that case take NOC

  34. Mathi says:

    Thanks Manish. Today I received my NOC certificate for my Education Loan from IOB Banks.

  35. Vishnu says:

    Manish, Is NOC required for Education loan as well? When I had closed it, I asked whether I get any kind of letter informing Loan Closure, they told nothing is required. Can you please suggest me?

    1. Yes, every LOAN .. Ask them for NOC . they will send it ! , ask them what is the legal document you have ?

  36. Anish says:

    Hi Manish,
    I had taken loans from my 7 LIC endowment policies (yes u read it right .. 7 policies!!) Later on I needed the money badly, so I just surrendered the policy through an agent. So when I surrendered the policy, they deducted their loan amount and gave me the remaining amount by directly transfering the money into my bank account. I havent recieved any letter from LIC stating that your loan is complete or your policy is surrendered . So my question is: do I need the NOC from LIC ?

    1. Yes, you still need NOC . Talk to LIC on this .

      1. Anish says:

        Thanks a lot Manish. I will let you know how smooth/hard was it to obtain the NOC from LIC

  37. shobha says:

    Hi Manish,

    Saw this 1st hand. Had a Home Loan with Axis Bank and closed it and got an SMS from Bank as well as NOC document.

    When I was applying for another Home Loan in SBI, the manager informed me that as per CIBIL report, I have a due ammount of 1.25 Lacs still showing.

    I shared the SMS on immediate basis with SBI manager and also the NOC Scanned Copy. Was able to get to all cleared in 2 Days. Also I had to call up Axis Bank Customer Service to get this rectified in there records.

    Sometimes these things happen and only if you have all financial proof you can resolve it.
    Shobha

    1. Nice.

      Thanks for sharing that !

  38. Tathagata Roy says:

    Thanks for a very useful information. I had taken an education loan from HSBC in 2004 and cleared it by 2010. I don’t have an NOC from them. If i write to them can i get an NOC now? Since i am not in India now how do i proceed?

    Kudos to you Manish!!

    1. Yes, they will send it to you on your registered address with them !

  39. vijay says:

    Thanks for the wonderful article. Apart from the car loan, house loans, personal loans, and CC stuff, I guess we might need the NOC even from consumer goods purchases that might have been done through one of those 0% interest financing?

  40. Bharani says:

    Excellent article, much needed education Manish, in today’s times.
    Commendable work in your site for personal financial planning. Became a fan now!

  41. Diptakshya Banerjee says:

    Thanks to Manish for highlighting such a great issue.
    NOC for loan clearance is a very essential legal document that every loan recipient must obtain from it’s bank after completion of paying of the EMIs.

    I will share my experience of how my NOC helped me got my Home loan.
    I was paying EMIs for my education loan from BOI Kolkata. I had to apply for my home loan but there was a issue regarding the % of salary that can be given towards paying the EMIs. I immediately paid off the education loan in full and insisted the bank to provide me the NOC which they did. I applied for home loan from IDBI Kolkata and submitted the copy of the NOC for Cibil clearance.
    They issued my loan within 7-10 days.

    1. Thats really good sharing . Thanks for adding it in comments . It will help others to understand its importance !

      Manish

    2. Thanks for sharing that Diptakshya !

  42. shishirjain2009 says:

    I had an education loan with Bank of India which I re-paid last year.
    Can I go and ask for NOC now ?
    At the time of repaying, when I asked banking officials for proof about Loan completion, they said just pay the balance amount no documents are required.

    1. Yes you can ask for it now

  43. Sunil Pai says:

    I have part paid my home loan and have got my original Sale deed back. Should I still be asking for an NOC?

    1. If you have completely paid off the loan, only then you can ask for NOC

  44. Deepak Nigam says:

    Hi Manish,

    Do we need to request NOC every time when we close any of our credit card? I have closed some of my cards in past and have not received it yet, though these were closed in normal case not a settlement case.

    Regards
    Deepak Nigam

    1. Yes, when you completely surrender a credit card, you need to have a NOC .

      1. KANTHAKUMAR says:

        HI Sir iam from Chennai 7 years back i had taken 20,000 PL from ICICI Bank and i have finished my loan and get NOC from ICICI Bank.
        Now i apply PL in Axis Bank they told in my Credit History it shown as “settled” in my existing PL from ICICI.

        But my credit score is 827 , it is possible to get a PL ? please reply

        1. Hi KANTHAKUMAR

          You should then check with ICICI why they have mentioned it as settled when you had fully paid the dues ?

  45. Hi Manish,

    Thanks for highlighting the importance of having the NOC. I had taken a personal loan with HDFC bank in 2007 and paid back it in 2009, haven’t got the NOC.

    In-case of any legal disputes in future, I have the bank account statement for that 2 years (2007-2009) which has the information of EMI deductions. Will this won’t help us to sort out the issue in case of any CIBIL score corrections.

    Regards
    Fasil

    1. Not fully . NOC Is the main document you need to have . Contact the bank and ask for it .

      Manish

  46. Benoy says:

    Thank you for this post Manish.
    I have a doubt. I had taken a PL on my credit card. Did not miss any EMI and paid it off 3 months back. I still continue to use the same credit card. Do you mean to say that I should get an NOC for this PL I had taken? Or is it inly during the closure of the CC?

    1. It will be only when you close the CC

  47. Dinesh says:

    Hi Manish,
    Thanks for this article. I had a question regarding NOC. Suppose i’m closing a credit card does the bank give a NOC? I’ve never had any outstanding carried forward and have always paid off my monthly dues on time.

    1. Hi Dinesh

      The NOC is given only when you close the full account. So for credit cards, its applicable only when you surrender the credit card and close it fully . We are not talking about the outstanding loans you pay each month .

      Manish

      1. Dinesh says:

        Thanks Manish, I meant the same thing.
        I’ve just applied for closure of a credit card. But i didn’t ask for a NOC.
        So i want to know if in case i’ve never had any outstanding and always paid full amount on time do i still need to be worried about NOC?

        1. Yes, you still need to . NOC is the document which will prove that you have COMPLETED the loan . Otherwise how do you PROVE it 🙂 .

          Just ask the company to give it to you

          Manish

    2. Yes, they will give you NOC and you should take it too !

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