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Summary:<\/strong> A car loan NOC confirms that the vehicle loan has been closed, but the process does not end there. Borrowers also need to remove the lender\u2019s hypothecation entry from the RC through the applicable RTO or VAHAN process.<\/p>\n\n\n\n A car loan NOC comes after you have fully repaid the vehicle loan. It confirms that the lender has cleared the loan. But the NOC does not remove the financier\u2019s hypothecation from the Registration Certificate (RC).<\/p>\n\n\n\n The loan account and the RC are updated separately. The lender closes the loan account after the final EMI, foreclosure amount and other dues are cleared. The hypothecation entry, however, remains on the RC until it is removed separately. Where available, you can start this process through VAHAN. The exact steps depend on the state and RTO.<\/p>\n\n\n\n The post-closure process also involves documents with different purposes. These include the NOC, a closure letter or certificate and Form 35. The closure letter or certificate confirms the loan-account status. Form 35, meanwhile, is used for the hypothecation-termination application.<\/p>\n\n\n\n The NOC connects these stages, so the first step is to understand what it is, followed by how to obtain it and use it for the RC update.<\/p>\n\n\n\n A car loan NOC (No Objection Certificate), is issued after full repayment of a vehicle loan<\/a>. It confirms that the dues are cleared. It also confirms the lender has no objection to removing the financier\u2019s hypothecation entry from the RC.<\/p>\n\n\n\n Paying the final EMI closes your repayment obligation, but the RC does not change at the same time. If the hypothecation entry remains, the financier will still appear on the RC until the registering authority removes it.<\/p>\n\n\n\n You may also receive a car loan closure certificate or closure letter after repayment. Since lenders may use these terms differently, check whether the document confirms loan closure, lender clearance or both.<\/p>\n\n\n\n The documents issued after repayment perform different functions:<\/p>\n\n\n\n Lenders may use terms such as closure letter and car loan closure certificate differently, so check what each document confirms. Form 35 serves a different purpose because it is used when the hypothecation entry is removed from the RC.<\/p>\n\n\n\n Once the loan account is closed, the next step is to obtain the NOC and other closure documents.<\/p>\n\n\n\n Read More – Car Refinance Loan<\/a><\/p>\n\n\n\n The car loan NOC process starts after the final EMI or foreclosure amount has been paid. The loan account must also be closed. Before waiting for the NOC, confirm that the payment has been credited. Also check that no outstanding dues or charges remain.<\/p>\n\n\n\n After closure of an existing auto loan<\/a>, the NOC is dispatched within 5 working days to the registered address. If you need another delivery location, contact customer care or visit a branch.<\/p>\n\n\n\n Follow these steps:<\/p>\n\n\n\n Once you receive the NOC, the lender-side closure process is complete. However, the hypothecation entry on the RC still needs removal.<\/p>\n\n\n\n Also Read – What are the Tax Benefits of a Car Loan?<\/a><\/p>\n\n\n\n Important:<\/em><\/strong> Receiving the NOC does not itself change the RC. If hypothecation remains, the financier still appears in the vehicle-registration record. This can add another step when the vehicle is later sold or transferred.<\/p>\n\n\n\n The next step involves hypothecation. The borrower must apply for Hypothecation Termination with the registering authority. A car loan hypothecation<\/a> entry remains until this process is completed.<\/p>\n\n\n\n Where the service is enabled, the VAHAN process generally involves:<\/p>\n\n\n\n Form 35 records termination of the agreement between the registered owner and financier. The RC and valid insurance certificate are also required. Depending on the state, proof of address, PUC and PAN\/Form 60 or 61 may also be needed. The financier\u2019s NOC may also be required.<\/p>\n\n\n\n The process can vary by state and RTO. Original documents or a physical visit may be required in certain cases. Where VAHAN supports hypothecation termination, more of the process may be completed online. Appointment and faceless-service options can vary as well.<\/p>\n\n\n\n Hence, after receiving a NOC for car loan, check the requirements shown for the vehicle\u2019s registering authority before filing.<\/em><\/strong><\/p>\n\n\n\n For hypothecation termination, the required documents can include the following. Note that some items may vary by state.<\/p>\n\n\n\n For online applications, upload clear and legible scans of the required documents. Make sure the complete document is visible. Names, registration details, signatures, stamps and other information should also be easy to read. Blurred, cropped, dark or incomplete scans may make verification difficult.<\/p>\n\n\n\n If an RTO requires physical submission, check whether original documents must also be presented with the application.<\/p>\n\n\n\n Once the documents are ready, the application can move to the registering authority for processing.<\/p>\n\n\n\nWhat is a Car Loan NOC?<\/strong><\/h2>\n\n\n\n
NOC vs Loan Closure Letter: What You Receive<\/strong><\/h2>\n\n\n\n
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How to Get Your Car Loan NOC<\/strong><\/h2>\n\n\n\n
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The Crucial Next Step: Remove Hypothecation From Your RC<\/strong><\/h2>\n\n\n\n
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Documents and Fees You’ll Need<\/strong><\/h2>\n\n\n\n
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