Srivatsa R (None) 08 July 2010

Settlement on a Citibank loan on phone

Hi,

I was offerred a loan on phone by citibank during May 2007. This was my first loan obtianed via phone. No documents were signed, no cheques were given and no loan documents were received from Citibank side stating the interest rate, foreclosure terms ammortization etc

The loan amount was Rs.1,33,000. Now after paying Rs.1,70,000 so far, I'm told that the interest on the loan is a whopping 34% p.a!!! When asked for foreclosure citibank is asking Rs.65000 for foreclosure. This means, for a loan of Rs.1,33,000, Rs. 102000 is charged as interest!!

During these last three years I've transacted close to Rs. 400000 on this card making regular repayments along with the interest. Recently also Rs. 45000 and Rs.80000 were paid for the card usage. These repayments were made on regular card usage and the EMI for the above loan is excluded from this amount

I want to foreclose this loan by paying minimum amount., say Rs.20000 only. Pls suggest a legal way to do this

Thanks and regards,

Srivatsa

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3 Replies

Uma parameswaran (lawyer) 08 July 2010

It is the duty to make sure about the interest and conditions of repayment before collecting Loan.If the interest are collecting against norms you can send legal notice .Otherwise send a request letter to waive or to lower the interest .

Kumar Doab (FIN) 12 February 2011

Since company has not suppled you approval,terms and conditions of loan including foreclosure, in writing you should give a written representation to local branch manager under acknowledgment.

You may offer to settle at the prevailing and competitive rates as with majority of the banks during discussion only and ask for letter .

Once accepted ,you should obtain F&F,NOC,and copy of CIBIL report in which there should be no adverse comment like "written off".

If you do not want you may consult your lawyer and file consumer complaint.