[Resolved]  DCB Bank — Mortgage loan

Address:

Bangalore, Karnataka

We borrowed a mortgage loan in the year 2006 and the loan was effective since may 2006. We borrowed a sum of rs. 12, 95, 000 by opting for floating rate of interest.

We pledged our property against this loan with a rate of interest 13% then and for a tenure of 144 months. I pay a sum of rs 18, 205 as emi towards this loan. Everything was going fine until november 2011. I had a person from dcb bank visited our place informing that citifinancial have transferred my loan to dcb bank and going forward all communications and loan will be with dcb bank. Also dcb bank had taken over this loan in the month of september 2011.

I happened to hear from them on the outstanding amount was approximately around rs. 11, 68, 000 and the remaining tenure as on september 2011 is 210 months.

I decided to close this loan and visited dcb bank on 26th july 2013. As on july 2013, i have completed a tenure of 86 months and have paid a total sum of rs.15, 65, 630 and the current outstanding against my loan is 11, 32, 000 (Approximate). Out of 15.5 lakhs of rupees, only 1.63 lakhs have been deducted from the outstanding. Currently the rate of interest that is being charged to me is 18.05%.

The dcb bank have increased the rate of interest every now and then and itseems that they have done so as per rbi guidelines. When asked to provide some evidence on the notifications they have received from rbi, they informed me to visit rbi office to get clarification as they do not share these information.

If i wish to continue paying the remaining outstandings promptly through emi's i will have to pay for the next 188 months (Which will be increased as and when there is a increase in rate of interest) a sum of rs. 34, 28, 000 approximately.

I was also told by one of the officer to clear of the loan or else the loan will not end and it will continue even after i die. There have been not even a single time where rbi has instructed the bank to reduce the rate of interest in the last 7 years.

People borrow money from banks when they are really in need. And that doesnt mean that they need to keep working even after they retire or in death bed just to pay this loan if they are unable to clear the outstanding at one shot payment.

Also i understand the banks make the customers to sign a booklet (Minimum 100 pages) of agreement with a font size of 4 printed on the sheets. And the customers will surely needs a month to completely go through these agreement to read and understand what they mean.

I understand its a banking business and everybody works for profit. But not to such an extent where customer will borrow the loan at the age of 25 and will clear the debts when he turns 75.

I urge the forum to look into this issue of floating interest rates against mortgage loans and bring in some effective ways to control these fraud money making system. Please bring in some easy way of rendering money and charge nominal rate of interest (As per the market condition) so that the customers get to know what they get and how much they end up paying after the tenure.

I request everyone to not go for mortgage loan with any of the banks. Even if you opt to go for mortgage loan, i suggest you get more clarifications of the type of interest they charge (Fixed rate of interest or floating rate of interest)

I am closing my concerns with this, but requesting some inputs on how do i approach bank to get some rebate on the total outstanding or can i reach out to consumer court in regard to this concern.