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Old 11th March 2014, 20:39   #106
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Default Re: Foreclosing an Auto loan - why the circus?

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Originally Posted by funkykar View Post
Teller: No sir, the procedure is to intimate a week before. We cant do anything.
ME: Whats the logic behind this?
Teller: I don't know sir, that's the procedure.
ME: Is it to collect the additional interest by delaying a week? Why don't u take that right away and tell me how much I should pay.
Just one point, most probably your loan is "monthly reducing", so you will not have to pay any extra interest (or EMI) unless intimation is done in last few days on month.

And even if extra EMI is deducted, it will be refunded in few days.
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Old 11th March 2014, 20:45   #107
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Default Re: Foreclosing an Auto loan - why the circus?

HDFC seriously does have a very nomad type of procedures and having experienced the pain of having to visit the branch for every small requirement, I decided I had enough of them and closed my saving account with them and shifted to SBI. Though the customer service and attitude of the people at the SBI branch is pathetic, there were no issues once the account was opened and I also linked my car loan to the online account as well.
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Old 11th March 2014, 21:01   #108
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Default Re: Foreclosing an Auto loan - why the circus?

I have foreclosed 3 loans. 1 autoloan and 2 homeloans. 2 from SBI and 1 from LIC Housing Finance.

With SBI (both loans), I was able to walk in to the bank, meet the manager, request for foreclosure, close the loan and leave with a letter from the manager that the loan has been closed with an hour or so. Since I was based in Cochin, I was also able to go to their centralized processing centre (RACPC) on the same day and walk out with the documents of the car/home, again within an hour or so. Painless - in both cases.

With LIC home loan, I was able to close the loan without much fuss, but they took about a month or so to return the property documents.

With the SBI car loan, I had to pay a penalty for the foreclosure. I asked the manager to waive it. But he told me that since I was closing the loan within the first year itself, it was the bank rule that penalty must be charged - and it was not really upto his discretion to waive it. So I paid the penalty amount.

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Originally Posted by for_cars1 View Post
That is surprising, SBI loudly advertises that they have no foreclosure charges whatsoever for their car loans. How much percentage did they charge as the penalty amount ?
I don't remember the penalty percentage or charges now. I had taken the auto loan in 2010 and closed it in 2011. The bank possibly does not have foreclosure charges now.

Last edited by StarrySky : 11th March 2014 at 21:31.
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Old 11th March 2014, 21:19   #109
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Default Re: Foreclosing an Auto loan - why the circus?

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Originally Posted by StarrySky View Post
With the SBI car loan, I had to pay a penalty for the foreclosure. I asked the manager to waive it. But he told me that since I was closing the loan within the first year itself, it was the bank rule that penalty must be charged - and it was not really upto his discretion to waive it. So I paid the penalty amount.
That is surprising, SBI loudly advertises that they have no foreclosure charges whatsoever for their car loans. How much percentage did they charge as the penalty amount ?
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Old 11th March 2014, 22:01   #110
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Default Re: Foreclosing an Auto loan - why the circus?

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Originally Posted by for_cars1 View Post
That is surprising, SBI loudly advertises that they have no foreclosure charges whatsoever for their car loans.
I believe foreclousure charges annulment has been in effect since Sep 2011. See this
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Old 12th March 2014, 16:13   #111
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Default Re: Foreclosing an Auto loan - why the circus?

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I believe foreclousure charges annulment has been in effect since Sep 2011. See this
It says floating rates. The EMI for me has been in tact for the last 40 months. I don't know/remember what I had signed up for. So my loan must be the fixed one right? So they have the right to deduct 3% I guess. Either ways, presently that's the least of my worries. I want to just get done with this ASAP!

I have not received any call for the grievance yet. Don't know if I have to intimate 7 days in advance to even write a grievance email.
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Old 13th March 2014, 16:48   #112
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Default Re: Foreclosing an Auto loan - why the circus?

Update:

Yesterday evening, I got a call from Nishanth who apologised for the inconvenience. I asked him the same 'Why should one intimate about closure 1 week in advance', he says its not mandatory like you have described in the complaint, but we do it just to talk to our customer to understand why they are closing and if they can retain and to build a customer rapport. I asked him, when car is sold there is no room for whatever he described. He said yes yes. Then I asked him why couldnt the teller/over phone try all those then and there itself and accept if they couldnt convince the customer. He had no answer. It clearly shows Deliberation by the bank to turn off the customer and also to make that last bit of interest for 1 more week. I showed a lot of displeasure narrating my experience. He had no answer why I had to wait so long in the office.

I finally said to him, lets cut the crap, I am never coming back to HDFC for anything in future and just tell me what I should do to close the loan ASAP. He said he will waive off the 7 day intimation period (something which he denied existed). Finally, he said I can come to the bank anytime and finish the formalities by talking to the manager Manjunath there. I double checked and asked if I can visit Thursday morning (today 10AM). He said yes. I asked if I can pay the entire amount by cash and get done with it instead of waiting for check to pass and stuff. He said yes. He also proactively said if you manage to wait a bit longer I will ensure you get the required NOC and letter instead of them couriering me. He also said usually they dont accept cash over 49k, but since I am inconvenienced so much, he will make an exception just for me.

Today morning, to save on time, I reached by 09:50. Already few people waiting at the door step as usual. Even though I dint need a waiting number, I still collected to see whats the waiting list like. Mine was #10 [Just tells the sorry state that even if u go before the branch opened, you still have to wait after they open]. The manager Manjunath was on leave. The manager on duty Shaiju was least bothered to talk to me. I had to peg him several times to get him to talk and explain the issue. It was clear that no one had informed about the case and what had to be done. Little did I know that my blood will have to boil again, and they will take me to the limit. I had to call Nishanth several times to make him understand that the manager was in no mood to help me nor understood the issue. I think Nishanth too had to work with the manager to convince (??) him to help me. Then they say to me that I cannot deposit in full cash as the RBI mandate says one cannot deposit over 49k for loan account. I questioned them asking if the mandate was from today? Both said it has been there since long. So, knowingly Nishanth made a false commitment to me yesterday? He tried to work something out with Mumbai or HQ or whatever. Then at 11:30 he says its approved and anytime now they will collect the cash and close it. Was a bit relieved and though it was worth teh time I waited. Then I am kept waiting till 12:10PM. I get more frustrated and go to the cabin of Shaiju. He then asks me "Why are you still waiting? Did Nishanth not say to you that we cannot accept cash?". This really set my blood boiling. One side I was told they will collect the cash after they got approval and the other the manager ridicules me? Called Nishanth again, he then said he cannot help me on this. Pay by check. I had to be part of their 2+ hours of drama for no mistake of mine. My sole reason of escalation was the BLOODY time it took at their bank and the stupid thing called process or procedure. Anyways, finally I gave the check and returned to my office.

Escalating the matter made things more worse? The person handling the escalation Nishanth was courteous all the time and treated me very very well, but may be isnt trained well enough on things like RBI mandate and stuff. Truely a sad state!

The manager behaved well with me in the last few minutes of handling the check and so on, dont know what made him do. Up to then he was quite arrogant, almost as if he part finances most loans under HDFC brand name.

I very STRONGLY suggest to research on closure procedures before going in for any Auto loan. I checked with a few of my collegues, who had no issues at all in closing auto loans with any other banks over the years (includes my experience of closing loan with SBI in a jiffy).

In my opinion, people working in IT industry or private sectors, or people who care about time to strongly stay away from HDFC. They can make life difficult. I have wasted 1.5 days of leave for something that could have been done over phone/online

If it helps:
- I made many friends at the bank today (Other grieving customers), else I would have been bored to death waiting
- While waiting near the teller's counter, I over heard several customers who had come for simple similar things.
- I over heard many customers being pissed off and talking to tellers in a raised voice just like I did for many missed things by HDFC

Last edited by funkykar : 13th March 2014 at 16:51.
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Old 13th March 2014, 17:20   #113
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Default Re: Foreclosing an Auto loan - why the circus?

Quote:
Originally Posted by funkykar View Post
Update:

Then they say to me that I cannot deposit in full cash as the RBI mandate says one cannot deposit over 49k for loan account. I questioned them asking if the mandate was from today? Both said it has been there since long. ....
Please see RBI Circular. For cash payments over RS. 50,000, the KYC must be in place. Third party depositing cash is a strict no in most private sector banks. If you are depositing cash into your account and KYC is in place, they cannot refuse. Only cash deposits over Rs. 10 lakhs get reported to RBI

Quote:
4. Ceiling and monitoring of cash transactions

The extant RBI guidelines on the subject are as under :

(i) Banks are required to issue travellers cheques, demand drafts, mail transfers, and telegraphic transfers for Rs.50,000 and above only by debit to customers’ accounts or against cheques and not against cash (Circular DBOD.BP.BC.114/C.469 (81)-91 dated April 19, 1991) Further, the applicants (whether customers or not) for the above transactions for amount exceeding Rs.10,000 should affix permanent (Income tax) account number on the applications (Circular DBOD.BP.BC.92/C469-76 dated August 12, 1976). Since KYC is now expected to establish the identity of the customer and as the issue of demand draft etc. for Rs.50,000 and above is by debit to account, the requirement for furnishing PAN stands increased uniformly to Rs.50,000/-.

(ii) The banks are required to keep a close watch of cash withdrawals and deposits for Rs.10 lakhs and above in deposit, cash credit or overdraft accounts and keep record of details of these large cash transactions in a separate register. (Circular DBOD.BP.BC.57/21.01.001/95 dated May 4,1995).

(iii) Branches of banks are required to report all cash deposits and withdrawals of Rs.10 lakhs and above as well as transactions of suspicious nature with full details in fortnightly statements to their controlling offices. Besides, controlling offices are also required to apprise their Head offices regarding transactions of suspicious nature. (Circular DBOD.BP.BC.101 /21.01.001/95 dated September 20, 1995). Early computerization of branch reporting will facilitate prompt generation of such reports.

http://www.rbi.org.in/commonman/engl...on.aspx?Id=117
Bank Managers avoid cash as their responsibility for cash holding increases

Cheers

KPS
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Old 13th March 2014, 17:26   #114
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Default Re: Foreclosing an Auto loan - why the circus?

Thanks KPS!

I was not very educated about these RBI guidelines. I expected the person handling the escalation to know. In fact he knew and he thought he could bend the rules?

He offered it to me saying he will make an exception and made a false promise without me asking.

HDFC sure taking loan closure experience to a new level!
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Old 13th March 2014, 18:15   #115
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Default Re: Foreclosing an Auto loan - why the circus?

Quote:
Originally Posted by funkykar View Post
Update:
He also proactively said if you manage to wait a bit longer I will ensure you get the required NOC and letter instead of them couriering me. He also said usually they dont accept cash over 49k, but since I am inconvenienced so much, he will make an exception just for me.
Quote:
Originally Posted by KPS View Post
Please see RBI Circular. For cash payments over RS. 50,000, the KYC must be in place. Third party depositing cash is a strict no in most private sector banks. If you are depositing cash into your account and KYC is in place, they cannot refuse. Only cash deposits over Rs. 10 lakhs get reported to RBI
I got my Loan account closed with Axis Bank by paying 1L in cash just 2days back.
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Old 14th March 2014, 08:41   #116
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Red face Re: Foreclosing an Auto loan - why the circus?

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Originally Posted by funkykar View Post
HDFC sure taking loan closure experience to a new level!
End of the day did you manage to get the NOC and the signatures on the form 28 from the bank? Is the frustration over or has been kept aside for a while?

An imp lesson learnt here for all car owners who have a car loan and are thinking of selling the car.

Do the initial homework on the car loan closure procedure from the bank. Keep the buffer period before the car sale for these formalities. Ensure that the new car owner is aware of the time required for the car transfer in case of loan involved. Finally hand over the car to the new owner only after the transfer papers are clear & hypothecation removed for that extra peace of mind.
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Old 14th March 2014, 09:41   #117
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Default Re: Foreclosing an Auto loan - why the circus?

Karthik (@funkykar) - I agree that the HDFC bank guys misled you with wrong information and kept holding you to believe that they could pull off what they really thought they shouldnt do and you ended up getting a poor experience. I think you should escalate this further in the bank.

Having said that, barring the pain of going to their office at Indiranagar for the closure, i always found it very smooth. For the two loans i have closed with them, both times, it required only one visit to Indiranagar for closure formalities and all documents were couriered to me home duly, within 15-20 days. ( ofcourse, i dont know why they need 3-4 weeks for this )
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Old 14th March 2014, 09:54   #118
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Default Re: Foreclosing an Auto loan - why the circus?

@Ghodlur: Not yet. Since Part payment by cash was made and forced to do rest by check, it has to pass and then they have to give me NOC. Their standard ETA is 15 working days. However, they said as soon as check is realised within couple of days we will mail you the required papers. I dont know if it is to be believed.

@jkrishnakj: Till date, even I had no issues with HDFC. Closure is pathetic. Believe me, the amount of time I spent in the bank and me over hearing lot of cases gave a very clear idea how pathetic the service is. There were a few folk who have been trying to get their NOC since months and the manager was very rude with them too.

As per the process at HDFC, a minimum of 2 visits to close a loan is MANDATORY!
1) To intimate a week in advance (however silly it may sound)
2) Pay the required amount

Trust me, for the 2 visits if you do not have 2-3 hours to WAIT at the bank, you will end up giving up and return next day. To be safe, you can say it needs minimum 3 visits and meditation prior to attempting helps.

Also, like Ghodlur says, its very very important to consider the closure procedures of bank. This may put your selling of vehicles into jeopardy. In most cases, while selling the owner may be dependant on sell money to close the loan since its very much possible that he too may be buying a new car and may not have abundant money of himself to close loan before selling. This is my case and my transfer procedure is being jeopardised by so called process/procedures of HDFC

Last edited by funkykar : 14th March 2014 at 09:58.
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Old 14th March 2014, 09:59   #119
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Default Re: Foreclosing an Auto loan - why the circus?

The issue is not end at Closing Loan or similar things with Banks.

I have my saving Account with PNB at my native place since my childhood days and now I'm living in Bangalore. When asked the nearest branch to transfer my account from my native place branch to theirs, initially they asked me to go to the branch where I opened my account but later after discussing for more than 3 hours with different officers, the agreed to do me a favour and asked me to submit a request for transfer of account to their branch and they will forward my request letter to the respective branch but still they were telling that it is on the native place branch to transfer or refuse transfer of account.

In Internet Age, it looks like the we are at the beginning of the civilization where it took ages to do one job.
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Old 21st March 2014, 17:55   #120
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Default Re: Foreclosing an Auto loan - why the circus?

As of today, I have still not received the NOC. This, even after I was promised ASAP (not more than 2 days) by the escalation team of HDFC some time mid last week. They simply don't care it appears

Last edited by funkykar : 21st March 2014 at 17:56.
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