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Request Letter to Bank for Closing Loan Account

To, The Branch Manager, ____________ (Loan Department) ____________ (Name of the Bank) ____________ (Branch Address)

Date: __/__/____ (Date),

Subject- Closure of the loan account (Loan Account number)

Respected sir,

I, ___________(Name) hold a ____________ (type of loan account) account in your bank. I am writing this letter to request you to close my ____________ (type of loan account) account bearing account number ____________ (Loan Account no.).  The reason for closure is due to  ___________ (reason for account closure – loan tenure complete/EMI Complete/ Full Amount Paid/Any other reason).

Details of the account are mentioned below: Loan Account holder/s name: ____________ Account number: ____________

As per bank requirement, I am enclosing ___________ (Loan account closure form, KYC, other documents if applicable) with the application. I have already _________ (completed the tenure/All EMI Paid /Full Amount Paid). I am authorizing to debit charges from the account for the closure of the loan account (if any).

Thanking you,

Kind regards, ____________ (Name) ____________ (Address), ____________ (Contact Number)

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Loan Closure Letter Format Sample in Word

Whenever you want to close your loan some times you need to write a request letter to the bank or finance company to close your loan.  It applies to all kinds of loans like personal clowns, vehicle loans and home loans, etc.

After closing your loan you need to get a no due certificate, which acts as proof that you have paid all the balance loan amount.

• Required documents to close loan
• Perosonal loan closure letter format
• Bike/car loan closure letter format
• Home loan closure letter format

Required Documents to Close Loan

• Loan A/c number.
• Loan approval letter
• Customer KYC like Aadhar & PAN.

Here you can find sample loan closure letter formats which you can also download in Word format.

Sample personal Loan Closure Letter Format

To The Bank Manager Bank name, Address.

From Your name, Address.

Sub: Personal loan closure application. 

Dear Sir/Madam,

I am writing this letter to request you close my personal loan bearing account no. _______ because I have paid (all the EMIs / paid full loan amount / loan tenure has completed / other reason) .

Please find all the required documents enclosed with this letter such as the loan sanction letter, my KYC documents like Aadhar & PAN copies.

I permit you to deduct the loan closure charges if applicable.

Thanking you.

Sincerely, Your name.

Bike/Car Loan Closure Letter Format

To The Branch Manager, Bank name, Address.

Form Your name, Address.

Sub: Vehicle loan closure letter format.

With due respect, I request you to close my vehicle loan under a/c no _________, which I have taken to purchase my bike/car of registration no. ______ .

I want to close the loan because I have cleared all the EMIs/ paid full amount/ loan tenure has completed/ other reasons. Kindly let me know the further steps to close my vehicle loan.

Regards, Your name. Mobile no.

Home Loan  Closure Letter Format

To Branch Manager, Bank Name,  Bank Address.

Sub: Home loan closure application.

I, [your name] writing this request letter to close my home loan bearing loan account number [321XXXX1234].

I have paid all my pending home loan amount and please find the copies of bill receipts enclosed with this letter.

Therefore kindly close my home loan and issue me the no due certificate and other required documents.

Yours sincerely, Your name.

How to close my personal loan

• Visit your bank’s branch.
• Fill the loan closure application
• Pay any pending loan amount/charges.
• Submit your KYC & loan closure letter.
• Sign the required documents.
• Collect the acknowledgment.

How do I know my loan was closed?

You will receive a loan closure SMS on your mobile and the bank send the loan closing documents to your address.

Should I need to pay any loan closure charges?

There is no need to pay any charges in normal cases, except  If you have any pending EMIs (or) if you wish to foreclose the loan. These charges vary from one bank to another bank.

Recommended:

SBI home loan closure letter format.

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Loan Closure Letter Format & Sample In Word, Pdf

Loan Closure Letter Format:  Are you searching for some of the Best Loan Closure Letter Format Sample In Word & Pdf? If Yes, then here you will get these types of application letter sample.

Let me tell you first, To close an account with the bank from which you took your loan, follow & read their terms and conditions very carefully.

Then write the account closure request letter using the application samples given below. Submit with it some documents (e.g. Personal Loan account number, approval letter, other documents issued by the bank) and Identity proof (e.g. Passport, PAN card, Aadhar).

If the bank has any pre-closure amount, then they have to pay it. Then in a few days, the bank will send you the loan completion document. After that all the process of closing your loan account will be completed.

The letter samples given below can be used for any bank without any problem. For example, you can use them in the case of HDFC personal loan closure letter format or SBI home loan closure letter format.

Personal Loan Closure Letter Format

To, The Branch Manager (Bank Name), (Bank Address), (Date).

Subject: Request Letter For Loan Closure.

Dear Sir/Madam,

I, ___________(Write Your Name) have a personal loan in my account on your _______ (Mention Your Bank Name) bank. I am writing this application letter to request you to close my personal loan account bearing account number ____________ (Mention Your Loan Account Number). The reason for closure is ___________ (Mention the reason for the closure correctly here).

I would like to inform you that I have paid all the EMI, loans. You can check your records. As per the requirements of the bank, I am attaching the applicable documents with this application.

Kindly consider this request letter and do the needful as soon as possible.

Thanking you,

Yours Faithfully, (Your Legal Name), (Your Address), (Your Email), (Your Mobile).

Car Loan Closure Letter Format

To, The Bank Manager (Name of the Bank ), (Branch Address), (Date).

Subject: Closure of the car loan account.

Respected Sir/Madam,

I am writing this letter to state that, I am holding an auto/vehicle/car loan bank account in your ________ (Mention Your Bank Branch Name) branch.

All details of my account are listed below: Loan Account Holder Name:- Loan Account Number:- Loan Approved Amount:- My PAN Number:-

Currently, I am willing to pay all my remaining amount and at the same time, I want to close my loan account.

So I request you, please let me know the detailed process and necessary documents for it. So that I can pay the remaining amount quickly and close the account.

Thank you in advance.

Yours Truly, (Your Name), (Full Address), (Your Contact Details).

Home Loan Closure Letter Sample

To, The Branch Manager, (Bank Name), (Branch Name), (Branch Address), (Date).

Subject: Application for home loan.

With due respect, I Beg to say that I hold a loan account & account no is ___________ [Mention Your Bank Account No] with your __________ [Mention Your Branch Name] branch. For some personal reason, I want to close my home loan account. (You can specify the reason for this closure)

Therefore, you are requested to kindly close my account. I will always be grateful to you. If any other information or documents is required for it, kindly contact me on my mobile number. my mobile number is ____________ (Mention Your mobile Number).

Thanking You.

Yours Sincerely, (Your Name), (Address), (Your Account Details), (Contact Details).

Loan Closure Letter HDFC, SBI & ICICI

To The Bank/Branch Manager, [Bank Name], [Bank Address], [Date:__/__/__].

Subject: Personal/Home/Car loan closure application letter.

With due respect, I ______ [Your name], I am writing this letter to request that I want to close my personal/home/car loan associated with loan account no _______ [Mention your loan account no].

Now, that I am already paid my total due & I request you to please go through the process of pre-closing my loan.

If you need any additional information or documents to complete this process, you can let me know at the phone number below.

Yours Sincerely, [Your Name], [Phone Number], [E-mail Address].

Read Also: Application For Closing Bank Account Letter

Application For Closing Loan Account

To The Branch Manager, [Name of the Bank], [Branch Address],

Date: Day/Month/Year.

Subject: Loan account close application.

Most respectfully I beg to state that, I ______ [Your name], I am a saving account holder in your branch. Also, I have a loan account & my loan account number is ________ [Mention your account no]. I want to close my loan account for some personal reasons.

Therefore, I request you to close my loan account and provide me with all the original documents that I submitted when applying for the loan account.

We hope you’ll consider my request properly and begin the process of closing the account as soon as possible.

Yours Sincerely, [Signature], [Contact Details], [Address].

Loan Closure Letter Format Sample In Word & PDF

👉 [Download In Word / PNG / PDF ] 👈

FAQ’s On Loan Closure Letter Format Sample

How do you close a loan account? You can easily close your loan account by following the steps given below –

• Visit the bank with all required documents.
• Write a loan closure letter to the bank manager OR, You may be required to fill a form.
• If there is a pre-closing amount, then pay it.
• Return your credit card. (If issue)
• Take acknowledgment paper from your bank.
• Then your loan account will be closed automatically in a few days.

Which bank is best for personal loan? Below we have mentioned the names of some of the best banks in India for taking loans –

• State Bank of India (SBI): Interest Rate- 9.60% onwards , Loan Amount- Up to Rs. 20 lakh .
• ICICI Bank:  Interest Rate- 11.25% onwards , Loan Amount- Up to Rs. 20 lakh .
• HDFC Bank: Interest Rate- 10.75% onwards , Loan Amount- Up to Rs. 40 lakh .
• Bajaj Finserv:  Interest Rate- 12.99% onwards , Loan Amount- Up to Rs. 25 lakh .
• Axis Bank: Interest Rate- 12% onwards , Loan Amount- Up to Rs. 15 lakh .

Can we close HDFC loan online? Unfortunately, you cannot close our HDFC Bank loan online, for this, you need to visit your nearest HDFC Bank and close the loan account. Also, you need to pay a certain amount to pre-close your loan.

Is there any pre-closure charges for home loan in SBI? No, you don’t have to pay any penalty for pre-closing your SBI home loan on fixed and floating rate interest. However, you may have to go to any branch of SBI and fill up some forms for it.

Online receipt makers can help you create professional receipts for loan closings. These tools let you customize the template, add your logo, and track receipts. Using a Zintego online receipt maker can help you create a clear and concise receipt that meets all of the necessary requirements.

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Loan Closure Letter

People worldwide opt for loans for various needs. There are so many kinds of loans that banks provide, such as Home Loan, Personal Loan, Car Loan, Gold Loan, Loan against Property, etc. Before learning about a loan closure letter, one should know what a loan closure is.

When a person opts for any loan from any lender, they need to repay the loan within a fixed tenure via Equated Monthly Installments (EMIs). Other than this, they can also prepay or foreclose the loan amount before the pre-decided time period. So, when a person pays off all the outstanding balance of their loan, the loan gets closed. This is called a loan closure.

A loan closure letter is a formal letter written to the lender whenever you want to close your loan. It applies to all kinds of loans like personal loans, vehicle loans and home loans, etc. After closing the loan you are required to get a no-due certificate, which acts as proof that you have paid all the balance loan amount. This letter will be retained by the person as an official note that he/she owes nothing more to the lender/bank as far as the loan transaction is concerned.

Loan Closure Letter: Guidelines and Tips

• The loan closure letter should be written following the format of a formal letter. As an official letter, the matter should be brief and to the point.
• It is important to mention the correct date for the bank to note down your date. It also acts as proof that you have written to the lender on a particular date.
• The subject should be precise and a single line telling the purpose of your letter.
• Add a formal and respectful salutation for the receiver.
• The main body should contain an introduction, the purpose of writing, and the bank details needed for the procedure.
• Mention in the letter, if you have attached some verification documents in the end.
• Senders should provide the contact details if needed for the process or in case of any query.
• Proofread the letter before sending it.

Format of a Loan Closure Letter

Sender’s address

Date: (dd/mm/yyyy)

Receiver’s address

Body of the letter

Yours sincerely/faithfully/truly

Sender’s name

Contact details

Attachments: (if any)

Sample Letter 1 – Letter for Closure of Personal Loan

21 Nehru Layout

Ganapati Road

The Branch Manager

State Bank of India

Main Branch

Subject: Request Letter for Loan Closure

Dear Sir/Ma’am,

I am Sudarshan Dubey, and I have a personal loan in my account in your bank. I am writing this letter to request you to close my personal loan account with the number 19948383782885.

I have cleared all of my EMIs, and the loan tenure is complete. I am attaching all the mentioned documents, including the No Objection Certificate, Payment Receipts, Loan Sanction Documents, and a copy of my Aadhaar Card and PAN Card as per the requirements of the bank with this letter.

Kindly do the needful and let me know the further procedure for the closure of the loan. Please contact me on the number or email provided below in case of any queries. I would be grateful if you could do the process at the earliest.

Yours sincerely,

Sudarshan Dubey

Contact number: 929588394783

Email: Sudarshan@dubey

Attachments:

• Loan A/c number
• Loan payment receipts
• No objection certificate (NOC)
• Aadhar Card copy
• PAN Card copy

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Sample Letter 2 – Letter for Closure of Home Loan

Apartment No. 134,

Krishna Apartments

Lakshmi Nagar

Central Bank of India

West Branch

Subject: Request for Home Loan Closure

I am Sudha Verma, a home loan account holder in your bank. I would like to bring to your notice that I have completed all the EMI payments for the loan, and thus would like to request for closure of my home loan account.

The actual tenure of my home loan with account number 174836839383 ends in August. As per the terms and conditions, I would have a minimum of a 3.5% prepayment penalty as I am closing the loan prior to the completion of the loan tenure. I am attaching all the mentioned documents, including the No Objection Certificate, Payment Receipts, Loan Sanction Documents, and a copy of my Aadhaar Card and PAN Card as per the requirements of the bank with this letter.

Yours faithfully,

Sudha Verma

Contact number: 748384637283

Email: sudha@verma

FAQs about Loan Closure Letter

Question 1. What do you understand by loan closure?

Answer. When a person opts for any loan from any lender, they need to repay the loan within a fixed tenure via Equated Monthly Installments (EMIs). Other than this, they can also prepay or foreclose the loan amount before the pre-decided time period. So, when a person pays off all the outstanding balance of their loan, the loan gets closed. This is called a loan closure.

Question 2. What is a loan closure letter?

Answer. A loan closure letter is a formal letter written to the lender whenever you want to close your loan. It applies to all kinds of loans like personal loans, vehicle loans and home loans, etc.

Question 3. Is a no-due letter/certificate important after loan closure?

Answer. After closing the loan you are required to get a no-due certificate, which acts as proof that you have paid all the balance loan amount. This letter will be retained by the person as an official note that he/she owes nothing more to the lender/bank as far as the loan transaction is concerned.

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Loan Application Cancellation Letter Sample: Free & Customizable

In this article, I’m excited to share with you a step-by-step guide, enriched with personal insights and a ready-to-use template, to help you cancel your loan application with confidence and clarity.

Key Takeaways: Understand the Importance : Know why a clear, concise loan cancellation letter is crucial. Gather Information : Ensure you have all necessary details like your loan application number. Be Clear and Concise : Your letter should be straightforward and to the point. Use a Professional Tone : Maintain a formal tone throughout the letter. Provide a Reason : Briefly explain why you are canceling the loan application. Include a CTA : Request a confirmation of the cancellation. Proofread : Always check your letter for errors before sending.

Step 1: Gather Necessary Information

Before you begin writing, it’s imperative to collect all the relevant information regarding your loan application. This includes your application number, the date you applied, and any other specifics that can help identify your case. This groundwork ensures your letter is not only accurate but also actionable.

Step 2: Start with a Professional Format

Begin your letter with your contact information at the top, followed by the date, and then the lender’s contact information. Use a formal salutation, such as “Dear [Lender’s Name or Department],” to set a professional tone from the outset.

Step 3: State Your Purpose Clearly

In the opening paragraph, get straight to the point. Clearly state that you are writing to cancel your loan application and mention the application number and the date of application for reference.

Example : “I am writing to formally request the cancellation of my loan application, submitted on [Date], with the application number [Number].”

Step 4: Provide a Reason (Optional but Recommended)

While not always necessary, providing a brief reason for your cancellation can be helpful. It adds context to your request and maintains transparency with the lender.

Example : “Due to unforeseen personal circumstances, I have decided to cancel my loan application.”

Step 5: Request Confirmation of Cancellation

It’s crucial to ask for a confirmation of your cancellation. This ensures that your request is processed and that there are no misunderstandings.

Example : “Please confirm the cancellation of my application in writing at your earliest convenience.”

Step 6: Close the Letter Professionally

End your letter with a formal closing, such as “Sincerely,” followed by your signature and printed name.

Tips from Personal Experience:

• Timeliness is Key : Don’t delay sending your cancellation letter. Prompt communication can prevent unnecessary processing.
• Keep a Copy : Always keep a copy of your cancellation letter and any correspondence for your records.
• Be Polite and Respectful : Even if you’re frustrated, maintain a polite and professional tone throughout the letter.

Loan Application Cancellation Letter Template

[Your Name] [Your Address] [City, State, Zip Code] [Email Address] [Phone Number] [Date]

[Lender’s Name or Department] [Company’s Name] [Company’s Address] [City, State, Zip Code]

Dear [Lender’s Name or Department],

I am writing to request the cancellation of my loan application, submitted on [Date], with the application number [Number]. [Optional: Briefly state the reason for cancellation.]

I kindly ask you to confirm the cancellation of my application in writing at your earliest convenience. If you require any additional information or action from my end, please let me know.

Thank you for your attention to this matter. I look forward to your confirmation.

[Your Signature (if sending a hard copy)] [Your Printed Name]

Frequently Asked Questions (FAQs)

Q: what should i include in a loan application cancellation letter.

Answer : In my experience, it’s essential to include your application number, the date of application, a brief reason for the cancellation, and a request for confirmation. This ensures clarity and helps expedite the cancellation process.

Q: How soon should I send a cancellation letter after applying for a loan?

Answer : Based on my practice, it’s best to send the cancellation letter as soon as you decide not to proceed with the loan. Prompt communication can prevent further processing and potential confusion.

Q: Is it necessary to provide a reason for canceling my loan application in the letter?

Answer : While not mandatory, I’ve found that providing a brief reason for your cancellation can foster transparency and maintain a good relationship with the lender for any future interactions.

Q: Can I send my loan application cancellation letter via email?

Answer : Absolutely, I’ve sent cancellation letters by email and found it effective. Just ensure you use a formal tone and follow the same structure as a printed letter, including all the necessary details.

Q: What should I do if I don’t receive a confirmation of my loan application cancellation? 

Answer : In my experience, if you don’t receive a confirmation within a reasonable timeframe, it’s wise to follow up with the lender. This ensures your request has been received and processed, safeguarding against any misunderstandings.

Q: How can I ensure my loan application cancellation letter is received and acknowledged?

Answer : I always recommend sending the letter with a method that provides a delivery confirmation or receipt, such as certified mail or an email with a read receipt. This way, you have proof of your communication.

Q: Should I consult a financial advisor or attorney before canceling my loan application? 

Answer : In my case, consulting a financial advisor or attorney wasn’t necessary for a straightforward cancellation. However, if your situation is complex or involves substantial amounts, seeking professional advice can be beneficial

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Understanding the mortgage loan closing process

What You’ll Learn

Typical closing timelines for homebuyers and homeowners

The most common reasons why closing dates are delayed

When your first mortgage monthly payments are due

Closing, the final frontier between you and the keys to your new home or the many benefits refinancing your mortgage can bring. When you get this far you’ve been pre-approved, conditionally approved, and cleared to close. After all that you’re probably ready for a drink, but like water fountains, drinking fountains, and bubblers, the words people use for closing can vary across the US. So here we’ll explain what closing means, all kinds of words you’re likely to hear, and everything you need to know to help make these last few days as smooth as possible. We’ll also cover what to do when you’ve finished your celebratory bubbles and need to start making mortgage payments.

What does closing mean?

It depends on who you ask and which state you’re in. For the purposes of this article, closing is your final step of the homebuying/mortgage refinancing transaction. If you’re buying a home, it’s the moment you get the keys. If you’re refinancing, it’s your signature on the last piece of paperwork you sign. This definition is important because different states work to different timelines, so the term “closing day” unintentionally means different things to different people.

Regardless of whether you buy or refinance, closing on a mortgage involves 4 basic steps:

Loan signing is when you sign all the paperwork. Loan funding is confusing because it sounds like this is when everyone gets their money, but in this case, it means the funds have been remitted to escrow . Escrow holds the funds for safekeeping until each party has completed their steps in the process. If you made an earnest money deposit they hold that, too.

Recording means that the grant deed to the property is, ahem, recorded at the County Recorder’s office. Once the grant deed is recorded escrow can disburse the funds and close the escrow account, hence the term ‘close of escrow’. Disbursement is when all the parties involved receive the money they’re owed and everyone can consider the mortgage closed. (Homebuyers will receive the keys to their new home when disbursement is complete.) And to describe the completion of closing when everything’s settled, you may hear the term ‘ settlement ’.

Wet vs. dry states and what it means to homebuyers

Wet states and dry states are real estate terms for the speed and protections that regulate homebuyers’ closing process. In wet states the whole closing process occurs while the ink is still wet. That means loan signing, loan funding, recording, disbursement—the whole kit and caboodle happens at the closing table. In dry states, there’s typically 1-2 days between the day you sign the loan documents and the day you get the keys, in other words, the ink is dry. This extra time is padded into the dry state closing process for an added layer of assurance and protection that all transactions are valid and legal, while also keeping the deal in progress. Dry states include Alaska, Arizona, California, Hawaii, Idaho, Nevada, New Mexico, Oregon, and Washington. All the other US states are considered wet states.

Because everything happens on the same day in wet states, people in wet states call the day you sign the loan documents ‘closing day’. As you can imagine, this term is somewhat misleading for homebuyers in dry states because if you’re planning to move in the day you sign, you may be sorely disappointed.

So let's take a look at how long all this takes.

Homebuyers closing timeline (around 3–7 business days)

*You can’t fund or disburse on a Saturday, so the overall process may take 7 days. In some dry states, all these steps may happen on the same day.

For both homebuyers and homeowners, there’s a mandatory 3-day period between receiving your closing disclosure and the loan signing no matter which state you live in. This is to give enough time to address any issues and ensure all parties, including the lender, are ready to close on time.

In wet states, it’s always best to schedule your loan signing as early in the day as possible. The complete process from signing to disbursement commonly takes around 2 hours. Worst case scenario it could take around 4. Loan funding and disbursements are transferred via the Federal Reserve wiring system, and their settlement deadline is 5pm ET. Given that it typically takes at least an hour to sign all the loan documents, if you start signing late in the day, it gets increasingly difficult for the wire transfers to be completed on time. So to save yourself a trip back to the closing table, and try to start signing before noon.

Refinance closing timeline (around 6–9 business days)

Homeowners who are refinancing a primary home have to wait the same mandatory 3-day period between receiving the loan disclosure and the loan signing, plus an additional mandatory 3-day cooling-off period. This is because refinance customers have the right of rescission: the ability to back out of the refinance mortgage agreement. Another interesting difference with the refinance closing process is that once the right of rescission has ended, the borrower's role in the process is complete. Disbursement is typically 3–5 days after your previous lender has confirmed funding has been received. In some cases, it may be quicker.

Ready, set, close.

Here’s everything you’ll need to know about the loan signing itself.

What to bring

• 2 forms of identification—1 must be a government-issued photo ID, the second form of ID can be your proof of homeowners insurance (so long as both borrowers have their names on the insurance)
• A certified or cashier’s check (if you didn’t do a wire transfer for your cash to close)
• Your attorney (if you’re in a state that needs you to engage a real estate attorney)
• Bringing your real estate agent is a personal choice

Who’ll be there

In both wet and dry states, a notary public will be present to witness and authenticate the signing of your loan documents. Since 2020, the use of mobile notary services has become more common around the country, especially in dry states. In many ways, it’s more convenient: the notary public will travel to you, you’ll sign all the documents, they’ll notarize them, and a courier will whisk the documents away to the title or escrow company who verifies that the paperwork is in order.

At a more traditional loan signing in a wet state you may be sharing a table with the following people:

• A notary public
• A title officer from your title insurance company
• Your real estate agent and the seller's agent
• Someone from the escrow company
• Your attorney or the seller’s attorney (if they’re required in your state or you request it)
• Your lender

For these types of loan signings, you’ll most likely meet at the office of the title company. This makes it faster and easier for them to review, package, and forward the signed documents to the lender, and for them to record the grant deed with the recording office. This whole process lasts between 1–4 hours, but as soon as the title company learns that the deed is being recorded and the loan is disbursed, you can leave with your new house keys in hand.

If you’re buying a home, it’s not unusual for the seller to pre-sign the deed and transfer documents, so there’s no need for them to be at the loan signing. If that happens, they’ll trust the keys with a title officer or their seller’s agent who will pass them to you when the loan is dispersed.

As local real estate customs and laws can vary, your loan team will be able to tell you who to expect to see at the loan signing.

What you’ll sign at the mortgage closing

The exact collection of documents you’ll sign as part of your closing package depends on where you live and the kind of property you’re buying or refinancing. That said, you can be sure it’ll include the following:

• Final closing disclosure
• Promissory note—your promise to the lender that you’ll pay the mortgage
• Deed of trust—(aka mortgage or security instrument) this means that while you promise to pay off the loan, you have the right to live at the property, make improvements, resell it, and benefit from any equity gained in the property.
• Initial escrow disclosure—this details all the specific charges you’ll be responsible for paying into escrow each month according to your mortgage agreement.
• Mortgage servicing disclosure—this lets you know your lender has the right to sell your loan to another loan servicer.

And if you’re refinancing your primary residence, the following document will also be in your closing package:

• Right to cancel form—(aka your right to rescind notice) this certifies the start of your 3-day cooling off period.

Closing delays happen, here’s how to handle them

If your loan signing date is pushed back don’t be alarmed, 1 in 4 homebuyers experience a closing delay . Another thing to keep in mind is that the closing date that's agreed on when you first lock a rate is actually a target closing date. The actual date you close can be after, or even before the target closing date. Occasionally closing can be delayed simply because the agreed upon closing date was unrealistic. Buying and refinancing a home involves a large cast of supporting actors working behind the scenes to bring the loan together and there can be any number of reasons that can delay closing. The two most common reasons—which account for nearly 50% of closing delays—are appraisal issues and financing issues.

Appraisal issues

Before a lender will agree to the loan, they need to know the true market value of the home. For this they’ll use a licensed or certified appraiser to conduct an onsite evaluation of the property, this is known as a home appraisal . The appraiser will compare the property to nearby, recently sold homes that are similar (these homes are known as comps). This information will give the appraiser a baseline for the property values in your specific local area. Once they know the highest and lowest prices for comps in your area, they’ll work within this range to add or subtract value for your property’s unique condition and features.

A good real estate agent will follow up to make sure the appraisal is completed, that the home is appraised at the sale price or more, and that no repairs are required as a result of the appraisal. If a lender requires repairs to be completed before the mortgage closes, the closing date could be pushed back.

Another issue that has become more and more common is appraisal gaps. An appraisal gap can occur when the price of the home is higher than the appraised value. The problem here is that lenders don’t want to lend more than the home is worth. If you find yourself with an appraisal gap, you have a few options available. A good real estate agent will ask the seller to renegotiate the sales price or ask for concessions. However, in an exceptionally competitive housing market, the seller has the upper hand and may not budge. In this case you could try working with your lender to appeal the appraisal. If that fails, you’ll need to increase your cash down payment or, if you’ve got no wiggle room in your budget, simply walk away. If appraisal gaps are common in your market, work with your real estate agent to find homes at a price point that helps you keep enough cash in your pocket to cover the gap.

Financing issues

Most homebuyers and homeowners soon learn that they’ll need to provide a lot of documentation when they begin the mortgage application process in earnest. Delays responding to document requests can naturally cause delays in the approval of the loan. One thing people may not expect, however, is that additional documents may be needed in the final days before they’re set to close.

Even though a borrower is approved for a mortgage, lenders typically do one final check of the borrower's documentation shortly before the closing date. During this underwriting phase of the loan, underwriters may uncover more things they need to review before they can approve the loan. For example, if the underwriter needed documentation to show that a check cleared, and you submitted a bank statement that also included a large deposit of $45,000, the underwriter will need additional paperwork to document where those funds came from.

If a borrower’s financial situation changes after they’ve been pre-approved, this can also delay the closing date. The lead up to closing is not the time to make a career change, buy a car or make a large purchase on credit. Lenders like stability and changes such as these can impact your debt-to-income ratio (DTI) or credit score. You could lose your loan approval if your credit score drops significantly or if your DTI increases. So keep your finances steady and respond to any document requests swiftly.

How does a closing delay affect my rate lock?

Rate locks typically last between 30–60 days which is enough time to get most loans through underwriting and to the closing table. If your rate lock does expire before this time, in most cases it can be extended—just make sure to check with your lender to see if doing so will result in any additional fees. Typically a mortgage rate lock extension fee is less than half a percent of the loan amount, but the actual costs vary based on the length of the extension. At Better Mortgage, rate lock extension fees are added to your closing costs. If we caused the closing delay, we cover the costs so you can extend your rate free of charge.

What you’ll need to do the first month after closing

First things first: Make sure to stash all your closing documents in a secure place.

If you’re a new homebuyer, how about a housewarming? When you’re done celebrating, your next step should be to change the address on your driver’s license . You may also want to apply for a homeowner’s property tax exemption (aka a homestead exemption). Eligible homeowners who apply may save on property tax, so check with your city or county to learn how to claim the exemption.

Fun fact: after closing, you’ll have a brief reprieve from monthly mortgage payments. Remember those prepaid amounts on your closing disclosure? A portion of these covers the interest that will accrue between the date you closed on the loan and the start of the first full month of your new mortgage. This means when your regular mortgage payments kick in, you’ll only need to pay the estimated total monthly payment that was quoted on the closing disclosure (not an additional prorated amount).

Your first mortgage payment will be due on the first day of the first full month after you close. That means if you close on April 15, your first mortgage payment is due on June 1. (April 15–May 31 was covered in your closing costs.) If you close earlier in the month, you’ll have an even longer break before your monthly payments start. You’ll receive a bill when your first payment is due.

You may need to pay a mortgage servicer instead of your lender

There’s a strong chance that your loan will be transferred to a mortgage servicing company. When this happens, your monthly mortgage payments will need to go to the mortgage servicer instead of your original lender. This is common practice and nothing to be concerned about. A loan servicing company does everything to maintain your mortgage on a month-to-month basis. They'll send monthly mortgage bills, collect your payments, maintain records of payments and balances, and collect and pay your property taxes and insurance (through an escrow account). They’ll also be responsible for remitting funds to the promissory note holder and following up on late payments. In some cases your loan servicing and the promissory note will be sold, this just means that the interest you’re paying will go to the new owner of the promissory note. The loan servicing company will take care of this for you.

If your loan is transferred to a mortgage servicing company, you should receive a “hello” letter from the new servicer and a “goodbye” letter from the old. In most cases, you’ll receive a letter from your current servicer notifying you of the change 15 days before the transfer occurs, unless you received a written transfer notice when you closed on the loan. The effective date of the transfer is when the first mortgage payment is due at the new servicer's address. The new servicer will also notify you within 15 days after the effective date of the transfer.

Better Mortgage services its loans after they close. The payment administration and collection are handled by our servicing partner, ServBank. At some point we might transfer your loan to a permanent servicer that’s selected from a large roster of reputable servicers and mortgage investors including major US banks, government-sponsored entities, publicly-traded mortgage companies, and specialized servicing firms.

Close faster, celebrate sooner

Our average closing time is 10 days faster than the industry average—thanks to the way we’ve automated many time intensive processes. This means you could go from pre-app to close in 32 days on average compared to the 42-day industry standard. Another key difference you’ll see is in the closing disclosure—we don’t charge lender fees. Lender fees are common additions to closing costs, but the way we see it, application fees, origination fees, rate-lock, processing, and underwriting fees don’t seem fair to the customer. To address this, we’ve built technology to streamline the entire mortgage process from start to finish which saves you money, but also saves you time. In as little as 3 minutes, Better Mortgage can show you how much you’re likely to be approved for, and get you on the path to the closing table.

Interested in more?

I'm buying a home

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Loan Closure Letter Format Sample in Word – 20+ Templates, Guidelines

• Letter Format
• March 6, 2024
• Loan Letters , Bank Letters , Request Letters

Loan Closure Letter Format Sample in Word: When you take out a loan, you are o bligated to repay the amount borrowed along with the interest charged by the lender .

Once you have paid off the entire loan amount along with the interest, you need to officially inform the lender about the loan closure . This can be done by writing a Loan Closure Letter Format Sample in Word to the lender. In this article, we will discuss the loan letter format sample in Word that you can use to write such a letter.

Also Check:

• Bajaj Finance Loan Approval Letter
• Bank Account Closing Letter Format
• NOC Request Letter Format Sample

Loan Closure Letter Format Sample in Word – Writing Tips

Content in this article

When crafting a Loan Closure Letter Format Sample in Word, consider the following writing tips:

• Use clear and straightforward language to convey your intention to close the loan. Avoid unnecessary jargon or complex sentences.
• This Loan Closure Letter Format Sample in Word Include your full name, address, and contact details at the beginning of the letter. This information is essential for proper identification.
• Clearly state your loan account number, original loan amount, and the current outstanding balance. Providing accurate information ensures a smooth closure process.
• If you are proposing a settlement amount, clearly mention it in the Loan Closure Letter Format Sample in Word. Include details such as the amount, payment method, and any other relevant information.
• If you are enclosing a check or bank draft, provide specific details such as the check/draft number, amount, and any other relevant information.
• Maintain a polite and professional tone throughout the Loan Closure Letter Format Sample in Word. This helps create a positive impression and facilitates cooperation from the bank.
• Clearly express your expectation of receiving a confirmation letter or closure certificate from the bank. This formalizes the closure process.
• Before finalizing the Loan Closure Letter Format Sample in Word, proofread it carefully to check for any grammatical errors, typos, or inconsistencies.
• Ensure that your letter complies with the specific requirements and policies of the bank. Contact the bank if you have any uncertainties.
• Utilize a Word template to maintain a professional and organized format. Customize the template based on your specific details and requirements.

By following these writing tips, you can create a well-crafted Loan Closure Letter Format Sample in Word that effectively communicates your request to the bank.

Loan Closure Letter Format Sample in Word – Sample Format

Below is a Sample Format of Loan Closure Letter Format Sample in Word:’

[Your Name]

[Your Address]

[City, State, ZIP Code]

[Loan Officer/Bank’s Name]

[Bank’s Address]

Subject: Loan Closure Request

Dear [Loan Officer/Bank’s Name],

I hope this letter finds you well. I am writing to formally request the closure of my loan account with [Bank’s Name], and I would like to settle any outstanding balance.

Here are the details of my loan account:

• Loan Account Number: [Your Loan Account Number]
• Principal Amount: [Original Loan Amount]
• Outstanding Balance: [Current Outstanding Balance]

I have enclosed a check/bank draft for the full outstanding amount. The details are as follows:

• Check/Bank Draft Number: [Number]
• Amount: [Amount in Words and Figures]

I kindly request you to process the closure of my loan account and provide me with a confirmation letter once the settlement is complete.

I appreciate your prompt attention to this matter. If any further documentation is required, please let me know.

Thank you for your cooperation.

[Your Full Name]

[Your Signature]

[Note: Adjust the details as per your specific situation and the policies of your bank. Always check with the bank for any additional requirements.]

Loan Closure Letter Format Sample in Word – Example

Here’s an Example of Loan Closure Letter Format Sample in Word:

[City, State Zip Code]

[Bank Name] [Bank Address] [City, State Zip Code]

Dear Sir/Madam,

Subject: Loan Closure Letter

I am writing to inform you that I have repaid the entire loan amount along with the interest that was due on [loan amount] that I had taken from your bank. I am pleased to inform you that the loan is now fully paid, and there is no outstanding balance remaining.

I request you to kindly update your records and issue me a no-objection certificate (NOC) regarding the closure of the loan account. Also, please issue a loan closure statement that shows the details of the principal and interest amount that I have paid towards the loan.

I would like to thank you for your cooperation and support throughout the loan tenure. I appreciate your assistance in resolving any queries and concerns that I had regarding the loan account.

Please confirm the receipt of this letter and let me know if any further action is required from my end.

Thanking you,

Yours Sincerely,

Loan Account No: [Enter Loan Account Number]

Loan Closure Request Letter

A formal letter for requesting the closure of a loan account, providing necessary details and enclosing payment, designed for a quick and efficient process.

Subject: Request for Loan Closure

I trust this letter finds you well. I am writing to formally request the closure of my loan account with [Bank’s Name].

I am enclosing a check/bank draft for the full outstanding amount. The details are as follows:

Loan Closure Letter to Bank

A formal letter to the bank, requesting the closure of a loan account, including necessary details and payment, designed for efficiency and confirmation.

[Bank Manager’s Name]

[Bank’s Name]

Dear [Bank Manager’s Name],

Enclosed, please find a check/bank draft for the full outstanding amount. The details are as follows:

Loan Closure Letter Format Sample in Word – Template

This is a Template of Loan Closure Letter Format Sample in Word:

[Your Name] [Your Address] [City, State ZIP Code] [Date]

[Bank Name] [Bank Address] [City, State ZIP Code]

Subject: Closure of Home Loan Account [Loan Account Number]

I am writing this letter to inform you that I have successfully repaid my home loan account [Loan Account Number] with your bank. I request you to kindly close my loan account and provide me with a loan closure certificate.

I would like to express my gratitude to your bank for providing me with a home loan that enabled me to purchase my dream home. I appreciate the professionalism and support provided by your bank throughout the loan repayment process.

I have attached all the necessary documents, including the last EMI receipt, for your reference. Kindly confirm the closure of my loan account and provide me with the necessary documents.

Thank you for your services, and I look forward to maintaining a positive relationship with your bank in the future.

[Your Signature] [Your Name]

Loan Repayment Closure Letter

A letter for notifying the bank about the completion of loan repayment, including details and a request for closure confirmation, designed for a clear and concise communication process.

Subject: Loan Repayment and Closure Letter

I trust this letter finds you well. I am writing to inform you that I have successfully repaid the outstanding balance on my loan account with [Bank’s Name]. Please find the details below:

• Repayment Amount: [Total Repaid Amount]

I have enclosed a check/bank draft for the final repayment installment. The details are as follows:

I kindly request you to update your records accordingly and issue a confirmation letter stating that my loan account is now closed.

Thank you for your assistance throughout the loan tenure, and I appreciate your prompt attention to this matter.

Loan Settlement Letter Format in Word

A formal for proposing a loan settlement, including necessary details and payment, designed for clarity and efficiency in communication.

Subject: Loan Settlement Agreement

I am writing to propose a settlement for my outstanding loan with [Bank’s Name]. Due to unforeseen circumstances, I am currently facing financial challenges and am unable to fulfill the original terms of the loan agreement.

I propose a one-time settlement payment of [Proposed Settlement Amount] to fully satisfy the outstanding balance. I understand that this amount may be different from the total outstanding, and I appreciate your consideration in this matter.

Enclosed, please find a check/bank draft for the proposed settlement amount. The details are as follows:

I kindly request you to consider this settlement proposal and provide a written confirmation of the settlement once the payment is processed.

I appreciate your understanding and cooperation in this matter. If you require any additional documentation or information, please do not hesitate to contact me.

Thank you for your prompt attention to this request.

Loan Closure Request Letter to Bank Manager

A concise letter for requesting the closure of a loan account, designed for efficiency and clarity in communication with the bank manager.

Email Format about Loan Closure Letter in Word

Here’s an Email Format for Loan Closure Letter Format Sample in Word:

Dear [Lender’s Name],

I am writing to inform you that I have successfully paid off my loan in full and would like to formally request a loan closure letter. My loan account number is [Loan Account Number].

I am extremely pleased to have been able to repay my loan within the agreed-upon timeframe. I would like to take this opportunity to thank you for your cooperation and support throughout the loan repayment process.

As per the terms of the loan agreement, I request that you provide me with a loan closure letter as soon as possible. The closure letter should include the following information:

Confirmation of the final payment made towards the loan. The date of the final payment. Confirmation that the loan has been fully repaid. Any other relevant details that may be required. I would also like to request that you send the original copy of the loan closure letter to my mailing address mentioned in my loan account details.

I appreciate your prompt attention to this matter and thank you for your assistance.

Loan Repayment Letter Sample Word

A concise letter template for informing the bank about starting the loan repayment, designed for clarity and acknowledgment, suitable for Word processing.

Subject: Loan Repayment Notice

I hope this letter finds you well. I am writing to inform you about my intention to start the repayment process for my loan with [Bank’s Name]. Here are the relevant details:

• Monthly Installment Amount: [Monthly Repayment Amount]

Starting from [Date], I intend to make regular monthly payments toward the loan until the outstanding amount is fully settled. Enclosed, please find the first repayment installment in the form of a check/bank draft. The details are as follows:

I kindly request you to acknowledge the receipt of this repayment and provide regular statements indicating the remaining balance.

If there are any specific procedures or forms that I need to follow for the repayment process, please inform me at your earliest convenience.

Thank you for your attention to this matter, and I appreciate your assistance in facilitating the smooth repayment of my loan.

Loan Closure Certificate Format Word

A letter for requesting a loan closure certificate, designed for clarity and formality, suitable for Word processing.

Subject: Loan Closure Certificate

I am writing to request a loan closure certificate for my loan account with [Bank’s Name]. The details of the loan account are as follows:

I have successfully repaid the entire outstanding amount, and I kindly request you to issue a Loan Closure Certificate as confirmation of the closure.

Enclosed, please find a copy of the final repayment acknowledgment and the check/bank draft used for the settlement.

I appreciate your prompt attention to this matter, and I thank you for your cooperation throughout the loan tenure.

FAQS for Loan Closure Letter Format Sample in Word – Templates, Guidelines

How do i format a loan closure letter format sample in word.

Use a standard business letter format in Word, including your contact details, the date, recipient’s details, subject, and the body of the Loan Closure Letter Format Sample in Word with necessary details.

What information should be included in a Loan Closure Letter Format Sample in Word?

This Loan Closure Letter Format Sample in Word Include your loan account number, original loan amount, outstanding balance, proposed settlement amount (if applicable), and details of the enclosed payment.

Can I use a template for a Loan Closure Letter Format Sample in Word?

Yes, templates in Loan Closure Letter Format Sample in Word can provide a structured format. Customize the template with your specific details, ensuring clarity and completeness.

Are there specific guidelines for writing a Loan Closure Letter Format Sample in Word?

Follow a polite and formal tone, This Loan Closure Letter Format Sample in Word clearly state your intention to close the loan, provide all necessary details, and request a confirmation or closure certificate.

Should I check with the bank before using a specific template for a Loan Closure Letter Format Sample in Word?

Yes, always ensure that the Loan Closure Letter Format Sample in Word template aligns with the bank’s requirements and policies. It’s advisable to confirm any additional documentation or steps needed for loan closure.

Loan Closure Letter Format Sample in Word is a formal way of informing the lender that you have fully repaid the loan amount along with the interest charged . You can use the loan closure letter format sample in Word mentioned above to draft your letter. Remember to keep it brief, precise, and professional in tone .

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Closing Car Loan Application Procedure (with Samples & PDFs)

I have listed sample templates to help you craft an effective and professional closing car loan application procedure.

Also, I would like to point out that you can also download a PDF containing all the samples at the end of this post.

Car Loan Termination Application Process

First, find the sample template for closing car loan application procedure below.

To, The Branch Manager, [Bank’s Name], [Branch’s Address],

Subject: Request for Closure of Car Loan Account

Dear Sir/Madam,

I, [Your Full Name], the holder of the car loan account number [Loan Account Number], request for the closure of the said account since I have fully repaid my car loan as of [Date of last EMI payment].

I kindly request you to initiate the necessary procedures to close the car loan account and provide me with a No Objection Certificate (NOC) as well as a loan closure certificate. These documents are important as they serve as proof that I have fulfilled all my loan obligations.

Please inform me about any additional paperwork or procedures that need to be completed for this process. I am ready to visit the bank branch at your convenience for the same.

I am grateful for your assistance during the loan tenure and look forward to your prompt action in this matter.

Yours Sincerely,

[Your Full Name] [Your Contact Number] [Your Email ID] [Your Residential Address]

Date: [Current Date] Place: [Current Place]

Below I have listed 5 different sample applications for “closing car loan application procedure” that you will certainly find useful for specific scenarios:

Car Loan Closure Application Following Car Accident and Total Loss

To, The Branch Manager, [Bank Name], [Branch Address],

Subject: Car Loan Closure Application Following Car Accident and Total Loss

I, [Your Name], holding the account number [Account Number], had availed a car loan for my [Car Make and Model] bearing registration number [Car Registration Number] from your esteemed bank on [Loan Taken Date]. I regret to inform you that my car met with an accident on [Date of Accident] which resulted in a total loss of the vehicle.

As per the assessment of the insurance company, it has been declared a total loss, and I have received the insurance claim amount. I would like to use this amount to settle my outstanding car loan with your bank.

My loan account number is [Loan Account Number]. I request you to kindly provide me with the exact outstanding amount, including any prepayment charges if applicable, and the procedure to close the loan. I would like to complete the loan closure process at the earliest.

Kindly acknowledge the receipt of this application and guide me through the next steps. I would be grateful for your prompt attention to this matter.

Thanking you,

Yours faithfully, [Your Name] [Your Address] [Your Contact Number] [Email Address]

Application for Re-Evaluation of Financing Terms Before Car Loan Closure

To, The Branch Manager, [Bank Name], [Bank Branch], [City],

Subject: Application for Re-Evaluation of Financing Terms Before Car Loan Closure

Respected Sir/Madam,

I, [Your Name], am writing this application to request a re-evaluation of the financing terms attached to my car loan (Account No: [Your Account Number]) before its closure. I have been servicing this loan for the past [loan period, e.g., 3 years], and now I am approaching the end of the loan term.

Given the recent changes in the economy and the financial market, I believe it would be prudent for both parties to reassess the terms of the car loan prior to its closure. This would help ensure that the closure process is fair, transparent and in line with the current market conditions.

I kindly request you to initiate the re-evaluation process at the earliest, as it will allow me sufficient time to make any necessary arrangements before the loan closure. I am willing to provide any additional documents or information that may be required for the re-evaluation process.

Looking forward to your prompt attention and cooperation in this matter.

Yours sincerely,

[Your Name] [Your Address] [City] [Contact number] [Email ID]

Transferring the Car Loan Balance to Another Lender Application

To, The Branch Manager, [Current Lender’s Name], [Branch Address]

Subject: Application for Transferring the Car Loan Balance to Another Lender

I, [Your Full Name], holding a car loan account with your esteemed bank (Loan Account Number: [Your Loan Account Number]) availed for purchasing a [Car Make and Model]. I have been regular in my loan repayments and have maintained a good track record.

Due to recent changes in my personal financial situation, I have found a more suitable loan offer from [New Lender’s Name]. Therefore, I request you to kindly initiate the process of transferring the outstanding balance of my car loan to the said lender.

I have already obtained a loan sanction letter from the new lender and have enclosed a copy of the same with this application. Kindly provide the necessary clearance and documents required for the transfer at the earliest.

I understand that there may be charges related to this transfer and I am willing to bear them as per the applicable terms and conditions. Please let me know if there are any additional formalities or documents required from my end to facilitate the smooth completion of this transfer process.

I appreciate your prompt action and assistance in this regard. Kindly acknowledge the receipt of this application and keep me informed about the progress of the loan transfer process.

Thank you for your attention and cooperation.

[Your Full Name] [Your Contact Number] [Your Email Address] Date: [Date of Submission]

Application for Car Loan Closure Due to Vehicle Sale

To, The Branch Manager, [Bank Name], [Branch Name], [Branch Address],

Subject: Application for Car Loan Closure Due to Vehicle Sale

I, [Your Name], am writing this letter to inform you that I have sold my car, [Car Make and Model], bearing Registration Number [Car Registration Number] on [Date of Sale]. The said car was purchased with the help of a car loan from your esteemed bank under Loan Account Number [Loan Account Number].

As the car has now been sold, I would like to request you to kindly close the said car loan account. I am ready to clear any outstanding dues or charges, if applicable, and would appreciate if you could provide me with a statement mentioning the outstanding amount to be paid for the closure.

Kindly consider this application as a formal request for car loan closure and guide me on the necessary steps to be taken to complete the process at the earliest. Your prompt assistance in this matter would be highly appreciated.

Thanking you in advance.

Yours faithfully,

[Your Name] [Your Address] [Your Contact Number] [Your Email Address]

Date: [Current Date]

Early Repayment for Car Loan Closure Application

To, The Branch Manager, [Bank Name], [Bank Branch Address]

Subject: Early Repayment for Car Loan Closure Application

I, [Your Name], have availed a car loan (Loan Account number: [Loan Account Number]) from your esteemed bank on [Date of Loan Disbursal] for purchasing a [Car Make and Model]. The loan tenure was [Loan Tenure] months, with an EMI of INR [Amount] per month.

I am writing this letter to express my intent to close the loan by making an early repayment of the outstanding principal amount. I have maintained a good track record of timely EMI payments, and my current outstanding loan amount is INR [Amount].

I kindly request you to provide me with the necessary details, including foreclosure charges (if any), the exact amount to be paid, and the required procedure to close the loan.

Please find enclosed a copy of my loan account statement for your reference. I would appreciate your prompt assistance in this matter, as I want to close the loan at the earliest.

Thank you for your attention to my request. I look forward to a favorable response from your end.

[Your Name] [Your Address] [Your Contact Number] [Your Email Address] [Date]

How to Write Closing Car Loan Application Procedure

Some writing tips to help you craft a better application:

• Start with your contact information: Begin the application with your name, address, and contact details to identify yourself.
• Include the date: Mention the date of writing the application to keep a record of it.
• Address the recipient: Directly address the person in charge of closing the car loan, such as the loan officer or branch manager.
• Specify the subject line: Clearly state the purpose of the application in a brief and concise subject line.
• Mention your loan account number: Provide your car loan account number for easy reference and tracking.
• State your intention: Clearly state that you wish to close your car loan and mention the reasons for doing so.
• Provide car loan details: Briefly summarize the car loan details, such as the loan amount, interest rate, and tenure.
• Request for a settlement letter: Ask for a settlement or closing letter that outlines the final payment amount and due date.
• Ask for necessary documents: Request the bank to provide you with the list of required documents to close the car loan, such as the No Objection Certificate (NOC).
• Specify your preferred mode of payment: Indicate your preferred method to make the final payment, such as online transfer, cheque, or demand draft.
• Confirm the procedure: Request the bank to confirm the closing procedure and the exact steps to be followed.
• Thank the recipient: Express gratitude for their assistance and cooperation in closing the car loan.
• End with your signature: Conclude the application with your full name and signature to make it official.

Related Topics:

• BSNL Connection Closure Application Request
• Credit Card Closure Application Letter
• Recurring Deposit (RD) Account Closure Application

View all topics →

I am sure you will get some insights from here on how to write “closing car loan application procedure”. And to help further, you can also download all the above application samples as PDFs by clicking here .

And if you have any related queries, kindly feel free to let me know in the comments below.

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• Letter Writing
• Formal Letter Writing In English
• Noc Letter Format for Bank Loan

NOC Letter Format for Bank Loan | How to Write and Sample Letters

If you are thinking of applying for a loan or closing your loan account, you will have to get a bank NOC letter. A No Objection Certificate is basically a legal document which is issued by the respective authority. If you want an NOC from the bank for the closure of your loan document, you will have to write an application for NOC from bank mentioning the reason for your request.

Table of Contents

What is the noc letter format for bank, request letter for noc from bank, noc for loan from bank, frequently asked questions on noc letter format for bank loan.

A bank NOC letter is written to the General/Branch Manager of the bank. In order to close a loan account or apply for a loan in a particular branch, you will require an NOC.

The NOC letter format for bank is just like other formal application to branch manager . The applicant must mention details like the account number, loan details, contact details, etc.

Samples of Bank NOC Letter

To better understand the format of request letter to bank for NOC, go through the following samples

The Manager

Bank of India

Sahid Nagar, Bhubaneswar

Market Building branch

Sub: Application for the closure of my loan

Respected Sir,

I have been a customer of your bank for 15 years with account number (mention your account number). I had borrowed Rs. 12 lakhs from the bank for opening my own restaurant. I was offered an 8-year term and agreed to all of the terms and conditions laid out by the bank. Three years have passed, and I have paid Rs. 6 lakhs, but I am unable to continue paying back the loan in instalments. I’d like to close the account by paying the remaining sum now that my business is performing well. I have made the deposit on January 31st. I respectfully request that you grant me a NOC certificate that includes all of my personal data.

Also, please send me a letter of authorisation for the clearance of my loan for future refernces. Given my current situation, I hope you will issue the NOC certificate to me as soon as possible.

Thank you in advance.

Yours sincerely,

Anisha Mishra

Contact- 99999

The Branch Manager

Name of the Bank and Branch

Subject: Application to issue a NOC for car loan.

With due respect, I, ________ (Name) residing at _____ (Address) wants to request you for a loan of Rs._____ from your bank. I have been a customer of your bank since ___ years with account number ________. I am raising this loan amount because I want to buy a new car from _____ showroom.

I am writing this letter to request you to kindly provide a NOC for the same for the loan of Rs. ____. Please revert back with the details of the documents required for the same. I shall be highly obliged for the same.

Yours sincerely

Account number-  ______

Contact: ____

How do I write a request letter to the bank for issuing the NOC for a loan?

In order to write a request letter to the bank for issuing the NOC for a loan, you will have to mention the reason for taking the loan. Mention the details of your account and your address. Also mention the amount you want.

Within how many days can I get an NOC from the bank to close the loan?

Generally, it takes three to four days for the bank to revert with the NOC and other clearance details of your loan account.

How long is an NOC valid for?

An NOC is valid for six months. After it is expired, you will not be able to proceed with the same NOC, you will have to request for another NOC.

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Published In: Applications

How to Write a Loan Application Letter (with Samples)

Sometimes we need financial assistance to push through with our business idea, education, medical emergencies, or any other personal project or goals that require a huge amount of money for its realization. Basically, it is for this reason that banks and other money lending institutions exist.

Applying for a loan from any lending institution requires the applicant to first fill out a form.  Along with this form, the applicant can attach a loan application letter that provides more details on what he/she intends to do with the money and an overview of how the loan will be paid.

As a loan applicant, you need to learn how to write the loan request letter in a polite and convincing tone to appeal to your lender for your loan to be granted successfully.

What is a Loan Application Letter?

A Loan application letter is a document that informs the financial lending institution of the amount of money you are asking for, a clear outline of what you intend to do with the money, and convinces the bank why you are a good investment risk. Because it is a request, a loan application letter should be written in a polite tone, short and to the point.

The Loan Application Process

Based on the financial institution you choose, the process and time it takes for you to receive funding may vary. However, the typical loan application process may take on the following critical stages:

Pre-qualification stage

Prior to the loan contract, the potential borrower receives a list of items that they need to submit to the lender for them to get a loan. This may include Identification proof, credit score, current employment information, bank statements as well as previous loan statements.

Immediately this information is submitted, the lender reviews the documents and makes a pre-approval- meaning the borrower can move on to the next phase of the loan application process.

Loan application

In the second phase of the loan origination process, the borrower fills-in the loan application form either electronically- through mobile apps, websites, or paper-based. The data collected is then tailored to specific loan products.

The aspects that are included in the loan application form include the following;

The payment method- if it will be personal, through a check, or via online banking.

The payment frequency- There are several payment frequency methods, for example, Monthly installments, annually, or if the loan will be paid once.

The amount of interest accumulated on the loaned amount. This is the amount of money charged by the lender to the borrower on top of the amount which he/she has loaned.

The assets in the form of properties of the borrower will serve as collateral damage/guarantees in case the borrower defaults loan repayment or is unable to make his payments as per the agreed time.

Application processing

Once the application is received by the credit department, it is reviewed for accuracy, genuineness, and completeness.  Lenders then use Loan Originating Systems to determine an applicant’s creditworthiness.

Underwriting process

This process only begins after an application is totally completed. In this stage, the lender checks the application in consideration of various accounts, such as an applicant’s credit score, risk scores, and other industry-based criteria. Today, this process is fully automated using Rule Engines and API integrations with credit scoring engines.

Credit Decision

Based on the results from the underwriting phase, the lender makes a credit decision. The loan is either approved, denied, or sent back to the originator for additional information. If the criteria used do not match with what is set in the engine system, there is an automatic change in the loan parameters, for instance, reduced loan amount or a different interest rate on the loaned amount.

Quality Check

Quality check of the loan application process is very critical since lending is highly regulated. The loan application is then sent to the Quality Control Team to analyze critical variables of the loan against internal and external regulations on loans. This is often the last step of the application process before funding is approved.

Loan funding

Once the loan documents are signed by both the borrower and the lender, funds are released shortly after. Nevertheless, business loans, loans on properties, and second mortgage loans may comparatively take more time to be approved due to legal and compliance reasons.

Essential Elements of a Loan Application Letter

Now that you have already understood the complex loan application process, it is important that you know the critical points to include in your loan request letter to convince your lender to give you a business loan.

Here is how to effectively write a loan application letter:

Header and greetings

The first and most important element of your business or personal loan application letter should be a header and an appropriate greeting.

In your header, include the following details:

• Your business names
• The physical address of your business
• Business telephone and cell phone numbers
• Lender’s contact details
• Lender’s or Loan Agent’s Name and Title
• A subject line stating the loan amount you are requesting for.

Once you have written your header, include a friendly but professional greeting to start off your loan application letter in a cordial tone.

Business Loan Request Summary

The body of your business or personal loan request letter should start with a brief summary of your loan request amount, why you need the loan, your basic business information, and why you are an ideal risk investment for the lender. This section should be brief and concise. Only include the relevant information to capture your loan agent’s interest and keep them reading the body of your loan application letter.

Basic Details about your Business

Ideally, this is the third paragraph of your loan application letter. Use a few short and concise sentences to give a clear outline of your business.

Be sure to include the details below:

• The legal name of your business and any DBA that your business uses
• Your business structure- if it is a corporation- partnership, individually owned, etc.
• A summary of what your business does.
• How long your business has been operational
• Total number of employees
• A brief description of your current annual revenue

Once you have provided your basic business information, it is time to write the meat of your business loan request letter- clearly explaining why you need the business loan and how you intend to recuperate the investment.

The purpose of the business loan

In the fourth paragraph of your loan application letter, explain succinctly how you will use the business loan. Additionally, tell the lender why your intended use of the business loan will be a wise business investment.

While detailing this section, be as specific as possible and demonstrate to the lender that you have carefully considered the kind of revenue generation this new debt will accomplish for your business. for instance, don’t just say that you intend to use the loan for working capital. Rather, say that you plan to increase your inventory by 45% or that you need to increase your Human Resources to 4 to generate more income by 6%.

In the same paragraph, inform the lender exactly how the loaned amount will help generate more profits necessary to cover repayment plus the interest accumulated on loan.

Proof that you’ll be able to fully repay the loan

In this section, you need to demonstrate to the lender that you can pay back the loaned amount together with interest as per the agreed repayment period. You will want to use any figures from your latest income statements or balance sheets to prove your business is financially healthy and that it is a low-risk investment decision for your lender. In case you have other existing debts, be sure to mention them and include a business debt schedule if possible. If your business is profitable, highlight that in your letter since it something that most lenders pretty much look for in successful loan applicants.

In addition to that, consider including specific cash flow projections to demonstrate to your lender how you plan to fit repayment of the loaned amount plus interest into your budget.

Sample: Loan Application Letter

Sample 1: business loan application letter.

Samira Mitchell,

Mitchell Face Masks Limited,

4680 Forest Road

939, New York.

January 17, 2021

Mr. Wesley Kingston

Guarantor Trust Bank

679, New York State

Ref: Loan Request for $10,000

Exactly two years ago, I started my small face mask vending business in our local market. Over the last two years, my business has picked up really well to an extent where I need to expand to a bigger face mask vending company.

It is for this reason that I am writing this letter. I am confident that there is a great market niche for face masks, especially due to the current worldwide Novel Covid-19 Pandemic. Thus far, I have had many repeat customers, new customer links through referrals, and my client base has grown rapidly. Generally, there is an increase in demand for my products; therefore, I am requesting for a loan amounting to $10,000 to be able to supply more and satisfy all my clients.

This money, along with the amount that I have saved up from my profits, will enable me to lease a large, modern storefront and to import supplies that will help me launch my business plan.

I have attached my business plan, my latest business balance sheets, current business schedules, as well as my credit history statements for your perusal and review. If you have any questions or need any further clarifications, please contact me directly on (111) 345 679 or email me at Mitchel.facemasksltd.co.ke. Thank you for your consideration.

Samira Mitchel.

Sample 2: Personal Loan Application Letter

Dear Michael,

It is common for everyone to face difficult situations and bitter realities in life. I am currently facing a situation where everything seems bleak, and there seems to be no way out of this difficult situation. I am in debt, and I need to pay at least 30% of my house’s mortgage will be taken over by the bank, and I am currently ailing and weak, I’ll not be able to survive such a nervewrecking situation.

The only way I can avoid such a fate is by paying the full amount that is needed by the bank. I can be able to do so if I am allowed to take out a loan from the office, which is a privilege that the company has granted to all the employees. I would be thankful if the company allows me to borrow the money against my monthly pay.

Mr Brandon Brown

Do’s and Don’ts of Writing a Loan Request Letter

A loan application letter may increase or break your chances of receiving funding from any lending institution. This is because it is the first thing that lenders look for in the underwriting process when you submit an application. That said, you must know the dos and don’ts of writing a winning loan request letter to help you receive the funding that you really need.

• Check your personal and business credit scores before sending a loan request letter and take the necessary steps to improve them.
• Have all your financial statements ready, including cash flow statements, business balance sheets, P$L statements, etc
• Make sure to submit all your relevant credentials along with your loan application request letter.
• Always provide the correct and factual information to avoid fraudulent consequences.
• Don’t make your letter too long and unnecessarily wordy
• Don’t use an informal format while writing the loan application letter. Instead, follow the proper rules on writing formal letters
• Don’t include any false information in your loan request letter- be it your business’s current financial health, assets, and liabilities that may be used as collateral damage in case you default payment or why you need the money.

Things to Remember When Writing a Loan Application Letter

Generally, you should always consider the following essential tips if you want to write a winning loan application letter:

• The loan application letter is a formal document. Therefore, observe the proper rules of writing a formal letter.
• Clearly state your intent to borrow a given amount of money
• Provide a vivid but brief description of why you need the money. Your explanation should be concise, genuine, and transparent. While at it, explain how you plan to use the loaned amount and be very sincere about it.
• Explain why your business is a low-risk investment decision for the lender.
• Enumerate your assets and liabilities
• Include the time, date, manner, and method that you will use to make your payment.

Free Loan Application Letter Templates

Are you looking to get some financing for your business or personal emergency? Download our free, well-crafted Loan application letter templates to help you customize your loan request letter. Our Templates includes all the critical elements of a winning loan request letter that will successfully help convince your lender to grant you the funding you need. Download our templates today to help you get started!

Collateral is defined as something that helps secure a loan. Generally, based on the type of lending institution you pick, the lender will give you less than your pledged asset value. Lenders every so often quote an acceptable loan to value ratio, meaning that if you borrow against your house, for example, and it worth $400,000, you will be given a loan amounting to $380,000. Again, this depends on the bank.

The prepayment penalty is a fee that some lenders charge if you pay off all or part of your loan before the loan’s maturity date. These do not usually apply if you pay extra principal on your loaned amount in small amounts at a time. However, it is good that you counter check with your lender.

Every lender follows a different criterion to approve a business or personal loan. The application process depends on several factors; therefore, the time taken to receive funding in your account may take anywhere from a few minutes to several days. This depends on the type of institution you choose and the type of loan you are asking for.

Acquiring a loan is sometimes a necessity in one’s business or personal life.  Nonetheless, it is not always easy to get a loan as lenders are wary of granting loans due to loan repayment defaults and fraudulent borrowers. This article has provided you with great insight on loan application letters, the loan application process, essential tips for writing a winning loan application letter, and the dos and don’ts of writing a convincing loan request letter. If you keep these things in mind every time you are thinking of applying for a loan, you are sure to get the funds you need to ensure the smooth running of your business and sort any personal emergency that may come your way.

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There are times when we need financial aid to push through with our education, business ideas, or other personal projects or goals which require a huge amount of money for its realization. It is for this reason that lending companies have been existing ever since the days of old. Today, the primary step to being taken by someone who wants to borrow money from another individual or institution is to write a loan application letter .

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The Loan Application Process

• Before the loan contract , the borrower would send a loan application cover letter to the prospective lender to express his or her intent to ask for a loan.
• Afterward, when the lender has decided to consider the application for a loan made by the borrower, the borrower, and the lender would convene to negotiate the terms of the loan.
• The payment method, whether personal, through a check, online banking, etc.
• The number of times the payment is going to be made. There are various options. For example, the loan can be paid at one time, or it can be done in yearly or monthly installments.
• The amount of interest to be added on top of the loaned amount. The interest is the amount of money that is charged by the lender to the borrower on top of the amount which he/she has loaned. You may also see job reference letters .
• The assets (land, buildings, vehicles, or other properties) of the borrower would serve as collateral damage in case the borrower fails to make his/her payment on the time it is due.

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Things To Remember in Writing a Loan Application Letter

• Observe the proper rules for writing formal letters.
• State your intent to borrow a specific amount of money.
• Explain in detail the reason for borrowing money. You must be offering a clear, honest, and transparent explanation as to how you intend to utilize the money you intend to borrow. You may also see free application rejection letters .
• Enumerate your assets and liabilities.
• State the time, date, manner, and method which you prefer to make your payment.

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• Business Loans
• Posted on December 12, 2022
• Kortney Murray

A business loan application process often requires numerous documents, one of which is a request letter. This letter is a significant part of your application as it is written to request financial assistance from the financial institution.

In most loan application cases, the success of your application process hinges on your ability to craft a convincing and professional business loan request letter. However, to do this, you need to know what the letter entails, the necessary information to include, and, of course, how to write one. 

To help you with your application process, below we have compiled everything you need to know about writing a request letter for a business loan.

What Is A Business Loan Request Letter?

During your loan application process, whether you are getting a business loan for your beauty salon or trucking company, your lender or financial institution will request information from you. This information is to help the lender or institution trust you enough to know that you will be able to pay back their loan.

Many times, the request for this information comes in the form of a business loan request letter. A request letter is a formal letter or a document that is written to request anything from an official. It can be seen as a way of asking for a favor from officials.

In this case, a business loan request letter is a letter to the bank or lending institution that supports your business loan request. During the loan request review process, the bank underwriter will pay attention to the content of your business loan request letter to see if you deserve to get your loan approved.

In essence, your loan request letter is the difference between your loan being approved or refused. A loan request letter usually commits elements such as the loan amount requested, detailed planned use of money if disbursed, reasons why you think you should receive the funds, and a detailed description of how you plan to repay the loan.

The loan request letter is usually requested when asking for financial help in the form of a loan. This can be when you’re applying for a loan from a conventional financial institution or bank lender, or when you’re requesting a loan from the SBA ( Small Business Administration ).

In both cases, you are trying to demonstrate to the lender that your business can repay the borrowed amount, and you have a plan for using the loan when disbursed. Although loan request letters are usually a part of loan application processes, they do not necessarily need to be a part of every loan application process.

Some situations require loan letters, and some can do without them. Some situations that do not require loan request letters are:

• Situations where you require a loan from specific lenders whose only concerns are your bank statement
• Situations where you request a business line of credit and the only requirements are recent business financial statements
• Situations where you request equipment financing and the equipment will be the collateral you need.

Regardless, writing a request letter for a business loan is an essential step to securing your loan. However, simply writing a letter is not enough. It is crucial to write an excellently detailed loan request letter that passes your message across quickly to the money lender.

What You Need To Know About Writing A Loan Request Letter

Many elements go into writing a loan request letter. These request letters are a form of well-documented proposal that accompanies other loan application documents, which is why they should convey specific information. When writing a loan request letter, your letter must have specific information. This information includes: 

1. Basic Business Information

Money lenders and financial institutions do not give out loans to businesses or individuals who walk up their doorsteps. They do not accept and disburse loans without knowing who the borrower is. A detailed business loan request letter should begin with a proper introduction that communicates the borrower’s basic personal and business details.

It is a great way to not only break the ice but also get the lender to be familiar with you and know you’re genuine. The basic business information should include the following:

• Your address
• Your business name
• Your business address
• Name of the money lender or loan agent
• Contact information of the loan agent
• Requested loan amount
• Current business project
• Current annual revenue
• Turnover of the previous financial year
• Current number of employees

These details tell the institution all they need to know about you, your financial needs, and your business. Needless to say, all information given should be legal and up-to-date.

2. Purpose Of The Loan

What is the loan for? How does the lender know you will use the loan for the right things? After offering the basic business information, it is essential to the money lender your plan for the loan when approved. Approving a loan to a business (especially small businesses) is a considerable risk for many financial institutions.

It would be best if you showed the institution that you plan to use the loan for the right things. When talking about the purpose of the loan, briefly tell the lender how you plan to use the business loan. Be concise and professional, yet offer enough details for total insight.

Be persuasive enough to help the lender see your vision and show them you have what it takes to use the loan properly.

3. Provide Repayment Assurance

Before money lenders approve business loss, they want to ensure they receive their money and interest at the due date. Without proper assurance, they will be skeptical and might refuse to approve the loan for disbursement. After drawing out the purpose of the loan you are requesting, it is essential to detail how you mean to repay the money on or before the duration of repayment. 

What are your plans to make back the money? How soon can you make money? Are there any risks that are expected? Still being persuasive yet professional, describe how you expect to pay the loan back. However, don’t just draw out a plan using words. Offer evidence to support your plan.

This will build your credibility and increase your chances of the loan being approved. Your evidence can include a business plan, personal finance and credit history (do you have bad credit? Here is all you need to know about getting a business loan with bad credit ), past business financial decisions and results, and any other relevant financial details.

As with any other letter, it is essential to close your business loan request letter. Your closing is your last chance in the letter to persuade the money lender to approve your application and agree on specific loan terms if possible. In the closing part, you can convey what approving the loan will mean to your business without sounding desperate.

Remain professional yet courteous at this point in your letter. The closing part of your business loan request letter is also an excellent opportunity to negotiate for specific terms, such as a certain interest rate or a longer repayment term. However, don’t just tender your requests.

Back them up with compelling reasons why the lender should take on these terms.

How To Write A Request Letter For A Business Loan

Now that you are familiar with the essential elements of a professional business loan request letter, it is essential to know how to write a convincing and successful request letter. Because your request letter plays an integral role in the success of your business loan application process, knowing the best way to write one is vital to your ability to win a loan.

Business loan request letters are usually about one page in length. However, they should be written professionally and in great detail.

1. Heading And Greeting

When writing a letter, it is a formality to have the heading and greeting first. The loan request letter is not left out. At the top of your business loan application letter, you are expected to leave a formal greeting and belief introduction of yourself. This is where the basic business information comes into play.

• Begin by writing your name and contact information
• Date the letter correctly (when the letter was written)
• Include the name, title, and other important contact information of your loan agent
• Include a subject line that states you are applying for a loan and the amount of loan you are applying for 
• Include a formal greeting.

Below is an example of a format for the heading and greeting section of your letter:

[Company/Business Name]

[Business Address]

[Lender Name]

[Lender Title]

[Lender Institution Name]

[Subject]: 

Dear Mr/Miss/Ms./Mrs [Name],

At a glance, the heading and creating part of your letter will tell the lender what they need to know about your business and the type of loan you need.

2. Summary of Your Business Loan Request Letter

What do you need the loan for? The second step and the second element when writing a business loan request letter is to briefly tell your money lender what the purpose of your letter is, the type of loan you need, and the amount you want to borrow. The summary of your business loan request letter is usually only a few sentences short.

The length may vary from letter to letter as every request letter is unique. Regardless, it should be nothing more than a summary.

For example: 

I am writing this to request a [kind of loan] loan in the amount of [amount] for the purpose of [purpose]. 

This is straight to the point but immediately tells the lender what you need and why.

3. Basic Information About Your Business

Following the summary of your business loan request letter, it is essential to tell your lender all they need to know about your business. To do this, you will provide basic information about your company. Although lenders want to know as much as they can about you and your business, they do not have the time to read pages upon pages of all information about your company.

They spend so much time processing other loan applications that a long introduction can be a big turn-off. So, instead of an entire file on your business history, write out the following:

• Your business’s recognized, registered, and legal name
• Your business’s legal structure (is it a sole-proprietorship company , partnership, or limited liability company?)
• Years of operation or how many years you have been in business for
• A concise description about what your business does or operates in
• Your company’s annual revenue and profit
• Number of employees

4. Description Of The Purpose Of The Loan

After offering the basic introductions, you must tell your lender why you need the loan. In this section, explain to your lender how you plan on using the loan when it is approved. Give them a great but brief insight on the plan and show them you have mapped out the use of the finances every step of the way.

For example, don’t just say you need to buy more stock. Instead, state what stock(s) you need, how much they are, how much you plan to re-sell, and how much revenue you plan to make back from this.

5. Show Your Ability to Repay the Loan

Show the lenders that you are more than capable of repaying the loan given by including several documents that show your current financial ability. Highlight your credit history and present financial disposition using financial statements such as:

• Summaries of up-to-date profit-and-loss or balance statements. This will show the lenders that your business is growing
• Schedules to show repayment plan for other outstanding debt that your company might owe to other lenders
• Future cash-flow projections . This will show your budget for the repayment terms and your ability to pay back.

6. Concluding Elements

As with any other kind of letter, you need to end your request letter with a concluding part. This concluding part should include several elements, such as:

• A final paragraph that refers the lender back to your attached documents and financial statement
• A paragraph persuading the lender to review your package
• A sentence showing the lender that you anticipate speaking to them soon
• Your signature
• A list of all included documents.

Sample Of Business Loan Request Letter

ABC Crescent Street

Miami, FL 12345

Jan. 1, 2022

Jack Stephen

Senior Loan Officer

678 Spring Road

Florida, FL 67890

Re: Small business loan request for $350,000

Dear Mr. Stephen, 

I am writing this to request a small business loan of [input loan type] of $150,000 for the purpose of [input your purpose of the loan]. 123 Movers is a successful business that is well-established in the transportation and shipping industry. Our success is recounted on our official website [input website URL].

123 Movers started operation in April 2018 in one location with just [input number] workers and [input number] trucks. Serving local and international clients, we have grown consistently over three years and now have over [input number] with [input number] of trucks in our services. 

Last year, our annual revenue totaled $1.2 million—[input more information about the growth of the business]. To promote our growth, increase efficiency, and improve the quality of our services, we plan to hire more staff and expand into new market sectors.

We request a [input loan type] to continue our expansion efforts and supplement our growth as a business. [Input more reasons/purpose for the loan application]. A loan in the sum of $350,000 will enable us to [state how the loan will help your business in this paragraph]. 

Attached below, please find our recent financial statements and our business plan for your review. I have also attached other necessary documents [state documents] to highlight how strong our financial disposition is. With a credit score of [input credit score], we are confident in our ability to adhere to the necessary loan terms.

Thank you for reviewing our letter and the attached financial documents. I look forward to a favorable response from you at your convenience.

John Doe [signature]

John Doe, Owner

123 Movers.

Perfecting The Art Of Writing Business Loan Request Letters

Writing request letters for business loans can be an intimidating process, especially if you have no practice doing so.

However, all you need is a few trials, and you will undoubtedly master the art of writing business loan request letters like a pro. Request loan letters are essential in many loan application processes, which is exactly why you need to put your best foot forward while writing.

Optimize your letter by including the necessary documents, highlighting your best assets, and following the proper format mentioned above. Include a header and greeting, a concise description of your request, your business’s basic information, a description of the purpose of your loan application, your ability to repay the loan, and a proper concluding element.

Although mastering the art of writing business loan request letters is one of the many steps in making sound financial decisions for your business, the first step begins with finding a financial company dedicated to offering the solutions you need.  With relationships with over 150 different programs and an aim to maximize your business’s growth, we at Coastal Kapital offer innovative financial solutions to business owners with all credit types. 

From equipment leasing to merchant processing, collateral asset and real estate-backed funding, we have all you need to grow your business. Contact us at 866-670-7483 to discuss your financial options!

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Biden's latest student-loan forgiveness plan brings questions for borrowers: What to know

S ome student loan borrowers may not take advantage of President Joe Biden's final plan to eliminate debt for millions because they don't know if they're eligible, don't understand the process or think it is a scam.

On Monday, Biden promised student loan relief by the fall with his final proposal. This plan comes less than a year after the Supreme Court blocked his initial attempt.

Under the proposed plan, more than 4 million borrowers who have been paying down their student loans for 20 years or more could have their debt completely canceled, according to the White House. The plan would also help more than 10 million borrowers by giving them $5,000 or more in relief, Biden's administration said.

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Biden also aims to help 23 million borrowers by eliminating interest past the original loan amounts.

How to apply for student loan forgiveness?

If eligible for debt relief, borrowers should periodically check their emails for updates from their student loan servicers and Federal Student Aid .

While Biden works on his final proposal, eligible borrowers can apply on the Federal Student Aid website for other kinds of relief, including if they have a disability , work for a nonprofit , or are a teacher , government employee or medical professional .

Borrowers repaying their loans for 20 to 25 years can apply for income-driven repayment (IDR) loan forgiveness.

Several other loan forgiveness options are available on the Federal Student Aid website, but borrowers should check if they're eligible by looking closely at each selection. Victims of forgery, borrowers who declared bankruptcy and Perkins loan borrowers are examples of individuals eligible for forgiveness.

What document explains your rights and responsibilities as a federal student loan borrower?

A Master Promissory Note (MPN) is a binding legal document borrowers must sign before they receive a federal student loan promising they'll repay the loans and any accrued interest and fees to the U.S. Department of Education, according to Federal Student Aid.

Student loan debt: Averages and other statistics in 2024

There is one MPN for direct subsidized/unsubsidized loans and a different MPN for direct PLUS loans. All MPNs can be signed electronically.

"You may receive more than one loan under an MPN over a period of up to 10 years to pay for your or your child’s educational costs, as long as the school is authorized to use the MPN in this way and chooses to do so," the Federal Student Aid website says.

Am I eligible for student loan relief?

By checking their emails, borrowers typically receive messages explaining whether they're eligible for relief and what type they can apply for.

If not signed up for emails, borrowers can visit the Federal Student Aid website and check their eligibility by hovering over the "loan forgiveness" tab and clicking "types of loan forgiveness."

Once the borrower clicks "types of loan forgiveness," they will be taken to a page showing the available relief options. Borrowers then can check their eligibility.

Be aware of student loan scams

Federal Student Aid warns borrowers to be aware of scams because they "might be contacted by a company saying they will help you get loan discharge, forgiveness, cancellation, or debt relief for a fee."

"You never have to pay for help with your federal student aid," the office's website says. "Make sure you work only with the U.S. Department of Education, the office of Federal Student Aid, and our loan servicers, and never reveal your personal information or account password to anyone."

The emails to borrowers come from [email protected], [email protected] and [email protected].

Borrowers can report scam attempts to the Federal Trade Commission by calling 1-877-382-4357 or by visiting reportfraud.ftc.gov.

Student loan scam involving 'Mission Hills Federal'

The Federal Trade Commission announced March 13 that it is sending more than $4.1 million in refunds to 27,584 borrowers who "lost money to student loan debt relief scammers who lured consumers with fake loan forgiveness claims and pocketed their money," according to a news release.

The scheme, which "tricked students into paying hundreds to thousands of dollars" since 2014, went by many names including Mission Hills Federal, Federal Direct Group, National Secure Processing and The Student Loan Group.

The group made the borrowers pay "illegal upfront fees and pretended to lower consumers’ monthly student loan payments," according to the FTC. The operators also deceived borrowers into sending their monthly student loan payments directly to them by "falsely claiming to take over the servicing of the consumers’ loans," the agency said.

"In reality, few payments were actually applied to consumers’ student loans and in many cases, none at all," the FTC said. "Instead, the defendants kept consumers’ money for themselves."

This article originally appeared on USA TODAY: Biden's latest student-loan forgiveness plan brings questions for borrowers: What to know

A key student-loan forgiveness program will soon be paused. Here's what you need to know.

• Processing of Public Service Loan Forgiveness applications will be paused beginning in May.
• It's a result of the Education Department transitioning PSLF accounts away from servicer MOHELA.
• Once the transition is complete in July, borrowers will be able to track their progress through Federal Student Aid. 

Millions of student-loan borrowers will soon be impacted by a series of changes to a major student-loan forgiveness program.

The Education Department recently posted new guidance surrounding upcoming reforms to the Public Service Loan Forgiveness program, which forgives student debt for government and nonprofit workers after 10 years of qualifying payments.

Student-loan company MOHELA currently manages the entire PSLF portfolio, but according to the department's guidance, that'll soon change. The task of managing the program will be split up among several different servicers, and the Education Department will manage the overall program through studentaid.gov, where borrowers will be able to track their payments and progress toward forgiveness.

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Here's what borrowers in PSLF should know.

What will happen to PSLF applications?

Beginning on May 1, the Education Department will be pausing all processing of PSLF applications as the program transitions from MOHELA. While borrowers can still submit their applications during this time, they will be placed on hold until processing resumes in July.

During the processing pause, the department also said borrowers will not be able to access their PSLF history on MOHELA's portal, so it recommends that borrowers "save screenshots and correspondence for your personal records" by April 30.

Which company will manage PSLF?

Instead of MOHELA being the sole servicer of PSLF, several different companies that already help service student loans — including Nelnet and Aidvantage — will work with the Education Department to process borrowers' PSLF applications and payments. However, the Education Department maintains that it will "fully manage" the program.

This change resulted from the Education Department's announcement last year to overhaul student loan servicing and make the system easier for borrowers to access. It awarded five companies contracts to service student loans and emphasized that "vendor accountability is a central goal of the new servicing contracts, which provide rewards for better customer outcomes and impose consequences for failing to meet expectations."

What will PSLF look like after the transition?

A key change borrowers can expect once the transition is complete is the ability to check their PSLF status directly on studentaid.gov. According to the department, borrowers will be able to access a dashboard that tracks their applications and payments, and it should also result in "a decrease in processing time for PSLF forms," per the guidance.

Despite application processing being paused from May to July, borrowers are still expected to make their payments. Any payments made during that time will count toward eventual forgiveness, and any additional payments will be refunded.

As Business Insider previously reported, these changes come following months of scrutiny over MOHELA's handling of PSLF. Sen. Elizabeth Warren is holding a hearing next week to address MOHELA "impeding public servants' access to PSLF relief," and Warren, along with Senate Majority Leader Chuck Schumer and Sen. Bernie Sanders, called for a federal investigation into the company's practices.

Watch: Why student loans aren't canceled, and what Biden's going to do about it

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