Your bank will now have to pay you ₹5,000 daily, if it fails to return your property documents on time after you've settled your loan completely.
For better service after closing your loan,RBI has released this note for banks
In case of loan against collateral, it was found that banks did not release the property documents and charges related to the loan, even after paying off the loan.
From 1st Dec 2023, it will be compulsory to return the documents to you within 30 days of full repayment.
The timeline and place of return of the documents will be mentioned in the loan sanction letter.
In case you die, banks will have a planned out procedure to return the documents to your legal heir.
After 30 days of repayment, if the bank has not released your property documents, they will have to pay you ₹5,000/- for each day of delay.
If the documents are damaged, the banks will help you make new ones and this deadline will be extended to 60 days
This will ensure peace of mind for loan takers and make the banks more responsible and reliable.
It was a much needed move from RBI! more