Foreclosure penalty in violation of NHB directive.

Diwan housing finance comes under registered co with national housing bank act.please refer .notification issued by national housing bank to its all registered finanance co by speed post referring Letter no NHB (ND)/DRS/FolNo 36/2010 DTD Oct 18th 2010.not to charge prepayment or penalty for pre closure.If they over look they attract penal consequences under the nation housing bank act 1987. This is wholly owned by RBI. Infirm diwan finance they will refund send road before going to consumer or higher authority.

Diwan housing finance comes under registered co with national housing bank act.please refer .notification issued by national housing bank to its all registered finanance co by speed post referring Letter no NHB (ND)/DRS/FolNo 36/2010 DTD Oct 18th 2010.not to charge prepayment or penalty for pre closure.If they over look they attract penal consequences under the nation housing bank act 1987. This is wholly owned by RBI. Infirm diwan finance they will refund send road before going to consumer or higher authority.

Diwan housing finance comes under registered co with national housing bank act.please refer .notification issued by national housing bank to its all registered finanance co by speed post referring Letter no NHB (ND)/DRS/FolNo 36/2010 DTD Oct 18th 2010.not to charge prepayment or penalty for pre closure.If they over look they attract penal consequences under the nation housing bank act 1987. This is wholly owned by RBI. Infirm diwan finance they will refund send road before going to consumer or higher authority.

Dear Kaya,

Thanks for your advice. I had already sent HFC the circular referred by you {NHB (ND)/DRS/FolNo 36/2010 dated Oct 18th 2010} by registered post. Two key points conveyed by them through written response are:

1. The accounts for the month Oct'10 are closed, and can no more be revisited.

2. As per HFC's policy, foreclosure penalty was applicable on 23/10/10, too.

It also verbally declined to spell out 'effective what date, it stopped levy of foreclosure penalty'; by stating that "I shall only be bothered about whether penalty was applicable (as per said HFC's policy) on the date I closed loan (23/10/10)". Its blatant disregard for NHB circular (which does not leave anything to discretion of Housing Finance Companies) is baffling. It has not responded to subsequent legal notice in this regard, sent last fortnight. Does it make sense to approach Consumer Court, or I shall take the injustice in stride, and move on?

Thanks.

Why don't you approach the NHB to initiate penal action as per NHB Act; for functioning as rogue HFC? This will help create pressure on given HFC.

Although at NCDRC portal, you will find more judgements against NBFCs under purview of NHB, in comparison to entities under RBI purview. And this means there exists scope for NHB to improve upon the way it regulates...

Incidently, in judgement for case no. CC/637/2012, District Consumer Disputes Redressal Forum-II, U.T. Chandigarh pronounced in paragraph 8: "Unless specifically provided in the Agreement, the complainant would naturally presume that the loan would be subject to RBI Guidelines, as is the case for all financial transactions by all financial organizations". Please refer below link.

https://164.100.72.12/ncdrcrep/judgement/663614091013004203Raj%20Kumar%20DHFL.htm

I guess this HFC might have followed same strategy of money extortion from other borrowers who fore-closed loan in same time-frame, too. If couple of other HFCs were in same boat; then this appears a scam running into Crores.

You have unearthed valuable citation (paragraph 8, case no. CC/637/2012, District Consumer Disputes Redressal Forum-II, U.T. Chandigarh).

Under the circumstances to create a liability and to bring the matter within the limitation, you may move an application to NHB narrating the irregularities and gross violation of its order by Dewan Housing finance and their refusal to refund the excess deduction in the name of penalty for foreclosure, seek their intervention for relief and remedy with a copy to DHFL, on the basis of their reply whether favoring you or not, you may approach the consumer forum within your jurisdiction. for actual relief which will be well within the limitation then. .

Dear Sir,

This is very practical and doable advice; considering 'limitation' being key hurdle here.

I had posted the query at 'expert' forum too, for wider response. Regret spamming caused by me.

Thanks a lot.

the circular point no 2 last sentence says that from immediate effect and how come they refuse to return your money 

you can initiate a complaint to NHB and also the process can be done directly visiting their office at your place and discuss with them personally which solves times also 

because already you had lost the precious time so any letter from NHB or any direction from then it will be an added advantage to go to consumer court if they refuse 

I completely differ. The NHB guidelines are meaningless if there is provision for the same in the agreement signed by you. The NHB in their website on the subject "Cell for redressal of grievances of depositors/borrowers of HFCs" have categorically stated the following

4. As regards loan related complaints, the Complaint Redressal Cell plays a facilitative role by taking up the complaints with the concerned HFC. It is for the reason that rates of interest including any increase or reduction therein, pre-payment or loan closure charges, loan disbursals, recovery on defaults in payments and other covenants in the loan agreement are not being regulated by the National Housing Bank. A loan transaction is essentially a contract between the lender and the borrower and both the parties are governed by the same. The borrowers are, therefore, advised to go through the terms and conditions of the loan and get all the terms clarified before signing the loan agreement.

Link :https://www.nhb.org.in/Regulation/Complaint_Cell_against_HFCs.php