bank should not charge the stale loan account. they cannot charge after three years of no communication unless you give in written to pay. you should issue notice to return your documents as no amount is recoverable by the bank. consult lawyer to avoid any wrong letter or communication.
Can bank recover unapplied interest after 14 years of acknowledgment
My father took a mortgage loan against commercial property to the tune of Rs2500000 in 1997 for business purpose from multi state scheduled bank. In Dec 2004 the account got NPA and bank reversed it's interest of around Rs600000(unapplied interest) and put it into another account. During that time the bank was about to get merged into another bank, so, to show recovery in 2005 the bank closed the account by paying the entire sum of Rs2500000 into the account internally and sanctioned us new loan of Rs2500000 with new rate of interest against the same property(it's a registered mortgage) in which they have not mentioned about unapplied interest. Further they executed unregistered indemnity bond on 200 rupees for the unapplied interest and instructed us to pay this unapplied interest within 18 months in equal installments for which the repayment period ended in June 2006(Jan 05 -June 06). Now, in 2011 we enquired bank about status of rescheduled new loan account ,for which, bank stated the amount of new loan account to be paid and also mentioned the unapplied interest to be paid with it. In 2013 we paid last installment of rescheduled new loan( principal + interest) completely except the unapplied interest. Now it has been almost 7 years bank has not sent us any letter nor it has filed any suit against us for unapplied interest. Property papers are still with bank So my question is 1)Can bank recover unapplied interest after 14 years after the acknowledgement of debt? Does law of limitation apply here? 2) Should I approach bank for papers or should I wait for few more years? Now, in 2011 we sent letter to bank to give us the status of our new rescheduled loan account on which bank stated the remaining loan to be paid along with unapplied interest which was shown separately and not included in the loan amount
Asked 5 years ago in Civil Law
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7 Answers
Claim of bank is barred by limitation
2) approach bank for your property papers
Can I approach Bank Ombudsman for this particular case?
Asked 5 years ago
First approach bank for property papers
based on response from bank take a call
1. If the mortgage loan has been fully discharged then the bank should have give back the title documents to you, if it is still held by the bank then the ban k would want you to clear the balance amount whether in the form of interest or outstanding loan.
Since it is mortgage loan, the mortgagor is entitled to get back his property on payment of the principal and interest after the expiry of the due date for the repayment of the mortgagee's money. This right of the mortgagor is called the Right of Redemption.
When the time comes for you to repay the balance of your home loan, this is 'mortgage redemption'. The process involves you paying off the full outstanding balance of your mortgage, and any other amounts added to it.
In the case of a mortgage, two categories of interest are generated. The first interest which is created is the interest of the creditor on the property. This interest is limited and temporary. The second category is the residuary interest which can be determined by deducting the interest of the creditor or the mortgagee, and this interest stays with the mortgagor. This division of the interest gives the right of redemption to the mortgagor when the loan is repaid. This right of the mortgagor is known as the equitable right to redeem. The right of redemption to the mortgagor is provided under Section 60 of the Transfer of Property Act, 1882. The contract of mortgage comes to an end when the mortgagor repays the amount of the loan and exercises his right to redeem the property. The right provided under the Act is a statutory right and to enforce it statutory provisions has to be followed.
If the bank authorities are not providing proper information or not cooperating with you to retrieve your documents held by them, you can always approach banking ombudsman and then accelerate the matter to the consumer forum too to get your grievances redressed.
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Yes you can file a complaint to banking ombudsman in the said case after 1 month of representing the said matter to the said bank in form of complaint
sir you are free to approach any official if your case is not heard by the bank. but if they do not hear you then you should approach the local court and seek damages besides declaring the charging of interest as wrong.