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Manjunatha on 13 January 2012
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LIC Housing Finance pre-payment charges

Even though I am paying back the loan from my savings and I am submitting bank statement to support my savings, lichfl is deducting prepayment charges for my payment. Prepayment charges are nil as per its ceo and it is declared in newspaper also. I had written to its area manager but till now it is not replyed. My loan a/C no. 0807 please help.

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Hey ritesh thanks for the response.

What sort of proof we can provide to show that money is from my own source/Income?

could you please details the repayment procedure....like did u give a check? whom should we need to contact... etc..

thanks for you help...


Please check with national housing bank site http://www.nhb.org.in there are circulars clearly states prepayment or part payment and also no charges even if it is not from own source if you are paying floating rate home loan. Check your self.


Prasanna Iyengar

Hi manjunath

thanks for your quick response. I went through all the 4 circulars(oct'10 oct'11 apr'12 and aug'12) regarding pre-payment of housing loan available in the nhb site however all these 4 circulars focus only on closure of the entire loan by making pre-payment and doesnt mention anything for part pre-payment explicitly. I searched the site to find any info about part pre-payment option but the other document which mentions about this also mentions the pre-payment penalty which is levied. Guess this could be because of the reason that these notifications are obsolete dated around 2003-04 after which only the 4 circulars have come.

If you possess certain updated circulars with notification of zero penalty on part pre-payment option request you to please share with us it will be very useful since most of the times approaching the nhb offices for clarity on this is painful and misleading process




Hi prasanna

I just did a part payment to lichfl.

I attached my 2 months bank statement which shows the flow of my salary to the account.

Lichfl representative asked me to fill a form that is related to checking the source of income.

This form needs to be signed by the LIC officer after confirming the documents.

Finally I got the benefit of not paying the prepayment charges.

Prasanna Iyengar

Hi vinesh

thanks for your confirmation in clarifying this. Its really very useful to all of us.





if we pre-pay fully/Partly for principal component bank with not impose "charge/Penalty" if paemnt is made from personal sources (like pre-payment from personal salaried account deposits mf ppf pf policies other saving account or loan from other financial institutions such as banks... etc.).

For payments made from rest of the sources bank will impose "charge/Penalty" such as financial support from parent/Wife/Son/Daughter/Relative/Friend from their sources [like income/Fd/Borrow/Etc].

Please correct if I am wrong.