[dobriyal]

Was anyone able to get a legal opinion on this issue? If the finance companies really are at fault, we can possibly file a complaint through the online RBI Ombudsperson complaint form.

[Kool_Kid]

Well I took my Car Loan from SBI , but had to sign any of these sales deed . I was short of cheques ( SBI wanted all the cheque of same bank , same branch ) so had to give them a blank cheque which was latter given back .

I dont think this is an RBI approved practice .

[dkamath]

Originally Posted by Kool_Kid

Well I took my Car Loan from SBI , but had to sign any of these sales deed .

I dont think this is an RBI approved practice .

Agreed. No blank RTO forms were required to be filled with SBI, except for the RTO Form-20, provided by the dealer and later submitted to RTO (after mentioning the hypothecation clause with the Bank Manager's attestation), during car registration.

Also, SBI doesn't take custody of the second set of keys. Assuming this has become standard practice amongst all banks now (though they did keep one key during the loan tenure of our older car, few years back).

[dicorex4x4]

What dkamath states is standard practice now I guess. I have all the keys, all original certificates etc. with me. Had it for my previous vehicle as well.

[Kool_Kid]

Originally Posted by Kool_Kid

Well I took my Car Loan from SBI , but had to sign any of these sales deed . I was short of cheques ( SBI wanted all the cheque of same bank , same branch ) so had to give them a blank cheque which was latter given back .

I dont think this is an RBI approved practice .

Sorry please read this as

' but did not have to sign any of these sales deed or any other blank papers / RTO forum' in-fact they even gave me one copy of entire agreement dispatched free of cost at my home.'

[Wheeliej]

take a personal loan from the Bank; a bit more expensive than a vehicle loan; but no such hassles. They will ask you why you need a loan; say personal reasons.

[anandtheleo]

Originally Posted by Wheeliej

take a personal loan from the Bank; a bit more expensive than a vehicle loan; but no such hassles. They will ask you why you need a loan; say personal reasons.

I would say it is way too expensive. The personal loan rate is hovering between 19-20% whereas the auto loan I got for my car was 11.75%.

[mmmjgm]

Hi All,
Personal loan rates IRR (internal rate of return) is now hovering around 24-35% p.a. reducing balance.

The interest rate is not the complete picture of your outgoings on a personal loan. When you total up whatever you have paid say documentation costs, and fees which companies charge you end up paying a packet.

What I have observed people who want to take a loan doing is that if they have a paid up house or an on going home loan, they take an additional amount and get the paid up part extended by an additional tenure (take a further loan on the house) however there are certain conditions which need to be applied in each individual case, LTV value, your nett salary to instalment ratios etc. Earning members in the house etc.

Best case scenario is you can take a loan against your house or add to your housing loan. This helps you save on taxes as well. Please note only a housing loan entitles you to save on taxes.

Cheers

M M

[gopinathann]

They ask to sign the blank papers but if we ask them to give in writing if they give any commitment, they don't do it.

There is no other way to go with it or simply sit without buying anything. If you read the finance document for a housing loan you won't agree to the terms and it will be all favouring to the banks, yet we have to sign though the banks claim it's a formality. Government should bring some transparent agreement with equal importance to both of them.

[TractionAvant]

A similar thing happened to me when I bought my Spark a month ago. I applied for a loan from HDFC bank. I have had a salary account with them for the last 4 years. So since they knew me, I assumed they would treat me differently. I should have known better.

I asked about the blank forms and they said they are a part of the formality. I agreed to sign after they promised to send me a copy of the full agreement in the condition I hand it to them (with blank RTA form etc.).

They also wanted me to sign a letter saying that I HAD defaulted on payments and that I am willingly surrendering my car to them. This was too much. loosing your car is one thing, loosing your reputation is quite another. I very clearly mentioned that under no circumstances would I sign any such letter. When they said it was a RBI regulation, I asked for a copy of the regulation. The next day the bank official called me and said that they were making an 'exception' ()and granting my loan .

I wonder, how much of the aggrement is actually as per RBI regulations

[supremeBaleno]

Faced this in 2005 with Countrywide while taking loan for my car. I refused to sign the papers which were not relevant. The agent said "standard practice with all banks, saar" etc etc. I said nothing doing. He put me on the line with his manager. Same line, same reply from me.

Finally, I crossed out the ones that were not relevant - dont remember which ones, but some really ridiculous ones. And others which I signed, I crossed out lines which were not relevant, etc. Took photo copies of all docs I signed. And yes, inspite of all this, they gave the loan. So, all you need to do is stand up, ask and stay firm. There are 1000 banks offering loans. If one does not agree, ask him to scoot and go to the competition.

Originally Posted by diabloo

There is no option except to sign and not take panga with the banks.

Sorry. There is an option, as I mentioned above. Just that you need to stand firm.

Originally Posted by mmmjgm

Let's say a person taking a loan pays off all the instalments. At the end of the tenure are these papers handed back ?
Or only the NOC for removal of hypothecation given ?

As per my experience, these are not handed back. I got only the NOC.

Originally Posted by headers

We can / should fight and refuse to sign. So while he tries to gas you into believing that RBI authorised him to do everything, if one is firm in the transaction and talks about the alternative finance options that one has got, then these guys come down to lick your feet!
Trust me, it works!

You got it right Vikram. Yes, it works.

Originally Posted by gopinathann

There is no other way to go with it or simply sit without buying anything.

There is a way, Gopi. Just that we need to explore our options.

All this needs is due diligence from our side, taking some effort to go thru the papers, and some patience. Believe me, from experience, I know that you can refuse to sign irrelevant documents.

[GTO - Touring]

Has anyone ever had a first-hand experience with a bank misusing those documents / signatures? Meaning, you have been paying your EMI's regularly and still they repo'ed / sold the car? Or perhaps an experience where they sold your car, using those documents, AFTER you paid off the entire loan?

None that I am aware of.

[Samurai]

Originally Posted by GTO - Touring

Has anyone ever had a first-hand experience with a bank misusing those documents / signatures? Meaning, you have been paying your EMI's regularly and still they repo'ed / sold the car?

It happened to my first cousin's colleague in IBM. They lost the cheques and then repossessed the car using goondas. He and my cousin visited the ICICI branch to talk to the manager, and the manager treated them very badly.

[dobriyal]

Originally Posted by Samurai

It happened to my first cousin's colleague in IBM. They lost the cheques and then repossessed the car using goondas. He and my cousin visited the ICICI branch to talk to the manager, and the manager treated them very badly.

There we have it! Thanks Samurai for posting this. It really puts a lot of weight behind the cause. It also gives us another perspective to the risk we face:

We may have to face the music even if the fault isn't ours, just because the bank has too much in their favor.

[GTO]

Originally Posted by Samurai

It happened to my first cousin's colleague in IBM. They lost the cheques and then repossessed the car using goondas. He and my cousin visited the ICICI branch to talk to the manager, and the manager treated them very badly.

Wouldn't it be simpler for the bank to inform the customer and take replacement cheques, instead of repo'ing the car? Its only in the banks interest to do this.