Car Loans - Waiver of foreclosure charges not processed

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Foreclosure of loan means settling of the due amount or the debt in its entirety before the date it was supposed to be paid according to the original loan documents. It may be allowed by banks under certain conditions and subject to certain additional charges that may have to be borne by you. Foreclosure charges are generally imposed to compensate for the loss occurred in regards to the lesser interest rate paid. This charge so imposed on the consumer may be waived off under certain conditions or on the basis of the policy of the bank or the financial institution or the lender. The circumstances may differ on a case to case basis. Once waived off, the charges are processed by the lender. They are either not chargeable at all, or if so paid by the consumer are subject to be reimbursed or refunded in due time. If any such waived off charges are not processed, you can raise a complaint with the Customer Care of the loan provider.

You should know
  • Car loan agreements are quite complex to understand and might cause a dispute or misunderstanding.
  • Locate your car loan agreement and find out whether your concern is mentioned in the document. Keep all other related documents readily available.
  • Determine the type of redressal you want against your grievance and act accordingly.
  • Keep a record of every conversation you have with your car loan provider. Note the name of executives you speak to.
  • Banks have a fixed procedure of car loan complaint resolution, including the hierarchy.
  • Your car loan matter should be ideally resolved within 30 days. Make sure you are given an explanation for delay beyond the stated time.
  • Pay your EMIs on time even if there’s a dispute- if you default, you may weaken your case and damage your credit score.

How to make a complaint against a car loan provider in India?

  1. Follow the bank’s dispute resolution procedure by first contacting the customer care cell of your car loan provider via Resolver.  You can also contact the car loan customer care department by calling on the given toll-free number. Your query should be addressed within 24 hours.
  2. Alternatively, you can state the particulars of your issue and Resolver will assist you in connecting with the right person. At this stage, the bank should ideally provide you an acknowledgment number against your issue.
  3. As another option, you can first try contacting the person who sold you the car loan deal. It might ease the process if you choose to approach the bank directly. You can also submit your complaint via the official website of the bank.
  4. As a next step, you can contact the Chief of the Customer Care Department/ Chief Grievance Officer to escalate your issue via Resolver. You can draft your complaint with the help of Resolver’s free online tool.
  5. The next step is to approach a Nodal Officer to further escalate your matter. A Nodal Officer is internally appointed by the bank for every city/ district. The Standing Committee on Customer Service or the Customer Care Committee of the Board can also be contacted for grievance resolution.
  6. Finally, your issue will be sent to the Banking Ombudsman, which is an independent authority for resolving financial matters. Your complaint will be heard and decided as per the facts and circumstances. You can file an appeal against the decision of the Banking Ombudsman at the Appellate Authority set up by RBI.

Resolver can assist you in escalating your complaint at any of these levels. You also have the option to file a consumer case at a Dispute Redressal Forum but this option is generally costlier and time-consuming. Resolver's free tool will help you get a settlement without taking the legal route.

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