Loan Preclosure & Foreclosure Charges Calculator
Calculate outstanding principal payoff, bank foreclosure penalty fees, future interest saved, and net savings from closing your loan early.
Loan & Preclosure Details
📊 Cost Comparison: Continue Loan vs Preclose Now
Bank-Wise Preclosure Rules & Penalty Guidelines
| Loan Category | Interest Type | RBI / Regulatory Penalty Limit | Typical Bank Policy |
|---|---|---|---|
| Home Loan (Individual Borrowers) | Floating / Variable Rate | 0% NIL Penalty | SBI, HDFC, ICICI, Axis, PNB charge ZERO foreclosure fee |
| Home Loan | Fixed Rate | 1% to 3% + GST | Applicable if prepaid from own funds or balance transfer |
| Personal Loan | Fixed / Reducing | 2% to 4% + GST | Subject to initial lock-in period (typically 6–12 months) |
| Auto / Car Loan | Fixed Rate | 2% to 5% + GST | SBI allows free foreclosure after 2 yrs; private banks charge 3-5% |
Frequently Asked Questions
What is a loan preclosure / foreclosure?
Loan Preclosure (Foreclosure) is the process of paying off the entire outstanding loan principal in one single payment before the agreed tenure ends. Once preclosed, all future monthly interest obligations cease immediately.
What are pre closure charges and penalties?
Preclosure charges are fees that banks or financial institutions charge for closing a loan ahead of schedule. Under RBI regulations (India) and standard banking rules in many countries, no preclosure penalty or foreclosure fee can be levied on floating-rate home loans given to individual borrowers. However, fixed-rate loans and personal/business loans may attract 1% to 4% foreclosure charges + taxes.
How do I calculate net savings after preclosure charges?
Net Savings = (Total Future Interest Saved) - (Preclosure Charges + GST/Applicable Taxes). In almost 99% of cases, the future compound interest saved drastically outweighs any small one-time foreclosure fee.
What is the difference between part-prepayment and full preclosure?
Part-Prepayment: You pay a partial lump sum (e.g. ₹1 Lakh or $10,000) towards the loan, and continue paying revised EMIs or reduced tenure. Full Preclosure: You pay the entire 100% outstanding principal balance, receiving a No Objection Certificate (NOC) and closing the loan account entirely.