Let the buyer approach a different Bank for getting loan sanctioned. The other Bank may not ask the particular document.
Bank loan
Hi, I have borrowed Loan in 2022 for House property in a bank the loan is running in good condition due to some financial problem i need to sale the property so i have identified the buyer, the buyer wanted loan so the buyer approached the bank where is my loan. The buyer produced all the required documents and the loan processed, at final the processing officer asked to produce documents which is not asked me to produce the at the time of my loan in 2022, due to that the loan is not sanctioned. We are unable to produce the same documents. My doubt is can a bank ask a documents which is not asked previously that is in 2022 to sanction loan today. if the bank denies to sanction loan in the absence of the said documents what is the remedy available to me because the bank lend me 2022 without discussing the particular documents. Thank you.
Asked 3 months ago in Civil Law
14 Answers
Transfer your loan to another bank
then buyer can approach said bank to purchase your flat and loan can be transferred to him
in alternative pre pay the loan
You cannot find fault at bank asking for various documents before sanctioning the loan.
It is not necessary that each bank should follow the same procedures, some banks may adhere to some other procedures in order to be doubly sure about the genuineness of the collateral property offered for grant of loan.
You can ask the buyer to approach any other bank which may have flexible conditions for grant of loan, or you may transfer the loan to any other bank which may not be rigid in its conditions and ask the buyer to approach the same bank for loan against the property he now proposes to purchase.
You cannot take any legal action for remedy to this act of bank
The query is, the bank sanctioned loan for the same property by not requesting documents which is now requesting. can bank show negligence towards loan for same property paper it has sanctioned earlier.
Asked 3 months ago
The bank can't show negligence towards loan for the same property papers it has sanctioned earlier. However if there's been procedural change now while sanctioning loan for the same property, then it has to be met.
However if you could mention the name of the document that the bank is now demanding, it can be resolved.
Dear Client,
I want to let you know that,
A bank can request additional documents for a new loan application even if such documents were not requested during a prior loan process. Each loan is treated independently, and the bank may update its policies or assess the risk differently based on a buyer's profile, regulatory changes, or internal procedures.
If the bank denies your loan because you do not possess those specific documents you can
1. Clarify the reason why the bank requested to have those documents, and try to solve this problem by discussing alternatives with the bank.
2. Approach the bank grievance redressal system and narrate the inconsistency in the requirement of documents.
3. File a suit in a civil court if the denial causes undue delay or results in pecuniary loss, but more than that, it is usually resorted to when all else fails.
Nonetheless, it has to be remembered that there is no explicit guarantee of the approval of loan applications under the discretion of banks processing the same.
Thank you.Hope this answers your query.
When the loan was originally sanctioned it was some other bank manager and now the manger has replaced the previous one.
As far as the sanction of loan is concerned, it becomes the individual responsibility of the bank manager to exercise due diligence before sanctioning it.
In the name of extra precautionary measure, the new bank manager may insist on various other documents in order to safeguard his future employment interests, hence he cannot be blames about it, if the demand is unjustified or illegal then you can take it up with the higher officer of the bank for intervention otherwise it is wise to look for some other bank which has flexible conditions.
Thank you for answering but I think the doubt is not clear, I am herewith writing it as example: Mr. A purchased the property in 2022 by opting Housing Loan from “XYZ Bank”, due to some financial problem Mr.A want to sell the property which Mr. A purchased in 2022. Mr. A identified Mr. B as purchaser, Mr. B wanted loan to purchase Mr. A’s Property. Mr. B approached “XYZ Bank” and same branch where Mr. A borrowed loan for purchase property in 2022. At the time of processing Mr. B’s loan in “XYZ Bank”, the bank asked to produce some additional four documents relating to property, out of the four documents three documents are in bank’s custody and not available with Mr. A or Mr. B, the documents are recorded in Memorandum of Deposit of Title deed which is entered by Mr. A and “ XYZ Bank” in the year 2022. The fourth documents what the bank asked is not available in with Mr. A or Mr. B. Upon verification of Loan documents and legal opinion of the year 2022 at the time of purchase property by Mr. A the fourth point is not discussed by the “XYZ Bank” or panel advocate. Here the doubt is: 1. Can XYZ Bank demand documents which is in XYZ Bank Custody itself for validate the property even though the parties are pointed out the requirement are available with “XYZ Bank” Custody. 2. The fourth documents what “XYZ Bank” demanding is not asked at the time of Mr. A’s Loan in the year 2022, but now demanding the documents and can “XYZ Bank” reject the loan application for the same property which is XYZ Bank sanctioned loan in 2022 by pointing out insufficient documents. Thanking you
Asked 3 months ago
If the document demanded by the bank for sanction of loan to B, then A should arrange to provide the documents demanded by bank to b to facilitate B to obtain loan.
If certain documents are held by the bank itself towards sanction of the loan to A, then A can submit the photocopies of the documents with an endorsement stating that the original documents pertaining to these photocopy documents are held by the bank in the form of MOD and request them to compare these photocopies of the documents wit the original documents held in the bank's custody.
As far as another new document that has been demanded by bank now would be another vital requirement, you cannot dispute the demand stating that the bank did not demand then abut unnecessarily demanding now.
The bank panel advocate can only recommend the loan but he cannot insist on the bank to grant loan, hence the final decision to grant loan would depend on the bank manager.
If you suspect the bank manager's intention behind demanding these extra documents with any malicious intention, then you may report the matter to the regional office of the bank about the suspected corrupted activity.
What is the fourth document, is it pertaining to the title to the property of the borrower?
However please note that the sanction or grant of loan amount whether personal loan or home loan or any other type of loan, will depend on the discretion of the bank manager who has to satisfy himself about the genuineness before sanctioning and the previous cannot be pointed out now to take shelter under the same mistake now by the borrower.
if any defect has been noticed by bank in sanction of loan there is no bar to bank demanding additional documents
1. XYZ Bank can't ask the parties to furnish the property documents for validation when the documents are in it's custody itself. However if the bank needs additional documents from the parties, apart from the documents in it's custody, then it may be furnished.
2. In all likelihood the XYZ Bank may not reject the loan application for the same property. Perhaps the Bank might be requesting for latest Encumbrance Certificate, Family Tree, etc.
Please indicate the particular document the Bank is demanding to conclude the loan process.
Bank cannot demand documents which are in its own custody
2) bank is at liberty to reject application if it feels that title is not clear and marketable
3) merely because bank sanctioned loan earlier and due to oversight one document was not asked for bank can demand said document when another application is made for loan
- Since, the loan is already sanctioned by the bank , then after the disbursement of the loan amount , the bank cannot ask for additional documents to save its skin, if the said loan was unconditionally.
- You can lodge a complaint before the RBI against the bank .
- Further, you have right to sell the property to adjust the remaining loan amount .
Hi, suppose the bank sanctioned earlier that in 2022 without verifying the property paper at the time of sanctioning but when the borrower want to sell the property to another party and the purchaser approaches to the same bank and the bank is asking additional documents, on prime facie it showing the negligence shown in 2022 or in 2024 they are asking irrelevant documents, any how one of the officer in 2022 or 2024 is showing negligence, in this situation what is legal remedy available to borrower borrowed in 2022, because the buyer in 2022 relied on Bank Panel advocate and processing unit for legality of property.
Asked 2 months ago
Just because bank has sanctioned loan earlier does not prevent bank from demanding further documents when you are selling the property
You may issue legal notice to bank as to why additional documents are being demanded when on same set of documents loan was sanctioned in 2022
The bank will follow the procedures of law.
It is not necessary that the successive officer has to ignore or be negligent similar to his predecessor officer.
No legal remedy will be available to you if you are instructed to comply the legal requirements by the present bank manager.
Rules for sanctioning loan may not change however if an earlier manager has committed any mistake it is not necessary that the successive officer also has to do the same mistake.
Therefore instead of entering into any controversy you may look for ways to solve the issue by following the steps suggested earlier.
- The borrower can approach the Consumer Court as well on the ground of deficiency of services