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You anyway have to travel to the sub registrar office to get the MOD document closed and your hypothecation removed. That is regardless of which bank you get your loan from, as your house or land is pledged as security against the loan.

RACPC will give you a set of your documents and loan closure paperwork back

They'll probably give you the number of an agent who can help handle the hypothecation removal

Call the agent, have him set up an appointment and prepare the paperwork.

Go with two witnesses and carry your aadhaar cards at the time you're told to go there.

Here’s my update:

I had to visit my home branch twice for closure. First time was to provide KYC documents, since my SB account was inactive.

The officer asked me to transfer the outstanding amount to the Savings account and not to the OD max gain account.

Visit two - The officer closed the account. Gave me two printouts. One is the NoC that is required to be produced at the RACPC and the second is for your records.

The RACPC visit again has to be twice. First time is to seek an appointment date for documents collection and for the second visit on the appointment date, show up with the NOC and original photo ID of all the loan applicants.

Luckily for me, when I visited the Koramangala branch, I went straight to the third floor and to the Property Loan section ( seat / counter numbers 6,7 ). I entered very casually straight to this counter and showed the original NoC and the gentle lady there said she’ll give me an appointment. I requested if I can wait in for an hour / 90 minutes and if she can help. After a quick 2 second thought, she said Yes.

While waiting outside, I saw many customers who were turned away by the security guard at the third floor- he doesn’t allow anyone inside. He’ll ask if it’s the first visit and if yes, he is the gatekeeper to take the NOC and come back with the appointment date. When I went in, I guess he was busy elsewhere.

The process there is that the officer provided the document number to the office Peon who then makes a run to their document storage and pulls up your files. It actually doesn’t take more than 10-15 minutes at best. But, you are not the only customer they are attending to, therefore the wait time is like 60-90 minutes.

Show proof of your government PhotoID (Aadhar is best ). Collect all your documents per the checklist that you would have signed during the loan sanction process. Also make sure to collect an NOC that you need to submit to registration office to remove hypothecation.

The last step for me will be to find someone familiar with the Begur registration office and seek help in the visit and hypothecation removal process.

Guys,
I am looking to go for a home loan. It will be a joint home loan and the plan is to max out the tax benefit for both. (Per year, 3.5 lac each . So planning to take 40 lac loan each). I have 3 questions.
1. Is SBI the best in terms of interest rate, hidden charge etc?
2. I still haven't finalized the property. Have shortlisted a few. Is there an option to apply now itself?
3. What is the recommended procedure?. Visit their branch or submit some online form ?

Bank of Baroda and HDFC are also offering 6.85% which I think is same as SBI. BoB however has zero processing fee and insurance is optional.

You have to shortlist the property to go ahead because the first steps from their end would be to check your CIBIL score and then go ahead with legal verification of the documents of the property.

Please visit the branch in case of nationalized banks because that is how you will get the full information.

Are you and your spouse planning to take two separate loans for the same property? Is it possible?

Yes. Separate loans. I think its possible.
https://cleartax.in/s/home-loan-tax-benefit

Adithya, the tax benefit can be claimed individually upto 2L per annum, but there cannot be two separate loans on a property. That also what article implies. You can have one big loan taken as joint loan and during IT filing can show the interest benefit taken as 50%.

As for starting the process before finalizing property, the only thing verified would be your eligibility. What I understand is, the individual eligibility check doesn't take long but it is the property document verification that takes the longest. This is for SBI as every application from same project used to be verified separately.

HDFC and other private banks used have some central repository of verified projects, and if you are buying in one of these, then the approval was quick.

SBI for the last several years has a RACPC branch in every city which certifies individual real estate projects for when people buy new flats direct from the builder. Any used flat is of course evaluated on a case by case basis.

RACPC was there even when I bought flat some 10 years back, and there were others in my society who got loans from SBI. Still my application was reviewed on stand alone basis. This was a new construction.

Thanks a lot shipnil for pointing out. I didn't realize that. This actually is better than taking 2 loans.
The property is an individual house. ( not an apartment). So I assume, it will take a lot more time for them to process. I will visit the branch and find it out.

One more thing to note. The ownership of the property has to be in joint name i.e. both of you are owners.

So to claim tax benefits by both of you, both need to be joint loan applicants. To be a joint loan applicant the property ownership has to be in joint name.

For SBI foreclosure have following questions.

1. Balance amount is there in my savings bank account, do I need to attach cheque or they would directly debit?

2. Would it be possible to pay by cash at branch? As amount is very less (sub 1k)

3. For first visit to branch or next visit to RACPC to collect documents, my co borrower (wife) also need to accompany? Or I am alone can collect.

The loan cannot be closed online, go to the branch and pay the amount as you please / as suits your manager.

You can go and close the account yourself if the loan and bank account are either or survivor basis rather than joint.

After that you and your wife both need to appear at the registrar office for MOD cancellation.

I have closed my SBI home loan account few years ago. Below is the answers

1. Yes. Easiest way is they will have a composite slip (Debit and credit slip in a single slip) which is to debit your savings account and credit the final balance in loan account. It will happen at the end of the day, generally at 5.00 PM. This happens in the branch and you will receive SMS.

2. I did not use cash and I am not sure whether they accept cash.

3. You can go alone to branch. Along with NOC, you can get the final statement of accounts print out from them or soft copy to you for your records.

4. You can go alone to RACPC with the NOC/Identity proof and they will get the documents based on it. Please verify whether all the documents are received properly. It may take some time and so they may ask you to come later in the day.

5. At least in Chennai, unofficially they have some broker/agent for MOD Cancellation and will give you the number. You can contact them and they will get the MOD cancelled. You need to provide the NOC and MOD document copy to prepare the MOD cancellation deed document. You do not have to go to Registration office but designated person from bank has to go for the finger printing. They will co-ordinate with the bank staff for the date and time. Once done, ask the agent to get the Encumbrance Certificate (EC) that reflects as receipt of document. If you are using your own agent, you need to co-ordinate with the bank staff availability.

Hope this helps!

Thank you so much Sir for this detailed info. It was very helpful to know the process/procedure beforehand before stepping into the branch.

I am in the same boat now. I hope by now this has been done already. Would you be able to guide me on what needs to be done ? Any DD to be drawn for the registrar fees ?


This may be a late info, just answering for the benefit of others. For joint home loan, presence of both parties is mandatory in RACPC to collect documents and also in sub-registrar office for MOD cancellation ( I am yet to do this ). But for NOC collection from SBI branch, I could do it alone.