State Bank of India (SBI) is a top lender in India that is committed to offering viable financial solutions to every individual in the nation. The bank has been working for several years towards making people financially independent. You can rely on the bank to provide you with any banking product such as personal loans, home loans, car loans, savings deposits, current accounts, debit cards, credit cards, and lots more.
The bank has separate segments for personal banking, agricultural or rural banking, international banking, SME banking, corporate banking, and NRI banking services.
If you are in need of finances for your personal needs, you can apply for a personal loan from SBI. You can take an unsecured personal loan or a loan against any security and fulfil your needs without having to rely on anyone else. You can repay this loan via equated monthly installments (EMIs) as per your financial repaying capacity.
Pre-payment or pre-closure of a personal loan refers to repaying the entire loan amount or a few parts of the loan before the original due date of the loan.
When you make a pre-payment, you can enjoy a lot of savings on your loan interest. Typically, most banks have a certain lock-in period during which you will not be allowed to pre-pay your loan. Once this period is completed and once you finish paying a certain number of EMIs (which is specified by your lender), you can repay your loan early. This can be done when you have built a lump sum amount of money in your personal bank account. You can utilize these additional funds to repay your personal loan early and clear your dues entirely.
Some banks also allow part payment where you clear a part of your loan before the due date. This can be done when you have a large sum of money but not sufficient enough to clear the full loan amount. You can go for part pre-payment to bring down your loan principal amount as well as interest amount.
When you decide to go for a pre-payment of your personal loan, you will have to bear in mind that your lender might charge a penalty for repaying your loan early. You will need to check with your lender regarding this before you start with the pre-payment procedure. Sometimes, this penalty may be higher than the interest amount that you will be saving for your personal loan. In such cases, it is better to not pre-pay your loan.
SBI enables you to make a pre-payment or a pre-closure for your personal loan. You have the flexibility to pre-pay in full or in parts. Moreover, you can do it during any phase of your personal loan.
You may have heard that it is always advisable to take a small loan amount and repay it as fast as possible. This makes sense when you have enough money for your various other monthly expenses. If you are confident that you can manage with the funds you have, then you can repay your SBI Personal Loan as soon as possible and then clear off all your loan outstanding dues. When you do this, you will save a lot of money on your interest.