RBI had recently issued new instructions to regulated entities (REs) like banks and non-banking finance companies (NBFCs) regarding property documents of customers lying with banks when taking home loans.
The Reserve Bank of India (RBI) had recently issued new instructions to regulated entities (REs) like banks and non-banking finance companies (NBFCs) regarding the property documents of customers lying with the banks when taking home loans. These new instructions are going to come into effect from December 1. According to this guideline of RBI, the bank will have to return the registry documents of that property to the customer within 30 days of fully repaying the loan of Movable or Immovable Property. If the bank does not return the documents within 30 days, it will have to pay a fine of Rs 5000 per day. Whereas in case of loss of documents, an extension of 30 days will be given.
Actually, when you go to the bank to take a loan for a property, the bank keeps the original documents of that property with itself. After repaying the loan, the bank returns these documents. But recently many complaints came from the customers and it was said that they have to wait a long time for this. Now RBI has asked banks and NBFCs to release all original movable and immovable property documents and remove charges registered in any registry within a period of 30 days after full repayment/settlement of the loan account. This new rule will come into effect from December 1, 2023.
What did RBI say in the circular
“As per the Guidelines on Fair Practices Code issued to various Regulated Entities (REs) since 2003, regulated entities are required to release all movable and immovable property documents upon receiving full repayment and closing the loan account,” RBI said in a circular. Is. However, it has been observed that REs follow several practices in issuing such movable and immovable property documents, which lead to customer complaints and disputes.
RBI has issued these instructions under Sections 21, 35A and 56 of the Banking Regulation Act, 1949, Sections 45JA and 45L of the Reserve Bank of India Act 1934 and Section 30A of the National Housing Bank Act 1987.
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