HSBC Bank — Unilateral change of housing loan terms

Address:

Mumbai Suburban, Maharashtra

Sir,

I took a Housing loan of Rs. 7,825,000 from HSBC (Smart Loan) in June-2005 with a loan term of 180 months. As per the loan agreemeent, HSBC was to deduct a predetermined EMI (Equated Monthly Installments) each month and approtion a part of which towards the reducing the Principle Amount and balance towards the interest charges for the loan amount.

However, just after a year or so, HSBC unilaterally changed the terms of my loan and also stopped collecting EMI from my account. HSBC unilaterally started aprotioning 100% of the monthly interest towards interest, thus keeping my principle outstanding unchanged since almost Feb-2007 (may be even earlier).

HSBC also increased the PLR (Prime Lending Rate) unilaterally very high (14.5% PA) and continuously milked interest from me month after month. On several visits to their Bandra branch, i was never given a satisfactory response and was given vague verbal replies. Cumulatively, HSBC bank has collected interest in excess of Rs.27 lacs from me thus far!

On closing the loan prematurely last year, HSBC volunteered to reduce the interest to 9.5% PA last month.

HSBC admitted their error in writing last week and apologized for their "Mistake". I do not agree with their apology and strongly feel that this is an wilfull act of cheating.

Since HSBC unilaterally changed the terms of the loan without even informing me, they tacitly, with malafide intentions, kept the principle loan amount unchanged against the agreement of reduction of principle amount every month. This has resulted in HSBC collecting higher interest charged on artificially inflated principle outstanding amount. Had they reduced the principle loan outstanding amount every month, the intrest charged too would have been a lot lower.

Hence I demand that HSBC returns the excess interets charged and collected from since Feb-2007 to April-2010. In my calculation, this amount would easily be arund 8-10 lacs.

Yours Sincerely,

Guruprasad Bhat
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