Foreclosure Net Savings
Loan Foreclosure Charges, GST and Savings
Break down foreclosure charge, GST, daily-interest differences and net interest saved before closing a loan.
Last reviewed: 16 July 2026
Direct answer
How do foreclosure charge and GST change the saving?
The charge is normally applied using the contract or lender quote, and GST may apply to that service charge. Both amounts reduce the future interest avoided; daily accrued interest can also change the final payment.
Worked example
A 3% charge on Rs 5 lakh is Rs 15,000 and 18% GST on the charge is Rs 2,700, reducing gross interest savings by Rs 17,700.
What to check
- Enter the quoted charge basis exactly.
- Do not apply GST to principal.
- Request a dated closure statement.
How the calculator approaches it
- 1.Reconstruct future interest from principal, rate and remaining tenure.
- 2.Subtract the lender foreclosure charge and GST.
- 3.Estimate the alternative growth forgone by using cash to close the loan.
- 4.Compare the result with a dated lender foreclosure statement.
Important limitation
Actual closure figures can include daily interest and contract-specific amounts. Charge rules depend on lender, loan purpose, rate type and current directions.
Primary sources
Related questions
FAQs
How do foreclosure charge and GST change the saving?
The charge is normally applied using the contract or lender quote, and GST may apply to that service charge. Both amounts reduce the future interest avoided; daily accrued interest can also change the final payment.
Which calculator should I use for this question?
Use RupeeKit's Loan Foreclosure Net Savings Calculator India and replace the example with your own current figures.
RupeeKit provides educational estimates only. This page is not personalised financial, investment, tax, legal or lending advice. Verify current rules, product documents and your own facts before acting.