Aditya birla loan close

Hi
We have a loan of 45lac from Aditya birla roi 10.7% mortgage loan after 1.2year 43.8 lac is remaining we want to close this loan as we hot a home loan at 7.7%bob but Aditya Birla asking for foreclosure charges i.e 4% very high thought rbi have removed these charges now confused what to do negotiate or complain in RBI for this


Help for better decision

Giant said:

Hi
We have a loan of 45lac from Aditya birla roi 10.7% mortgage loan after 1.2year 43.8 lac is remaining we want to close this loan as we hot a home loan at 7.7%bob but Aditya Birla asking for foreclosure charges i.e 4% very high thought rbi have removed these charges now confused what to do negotiate or complain in RBI for this


Help for better decision

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@Skylar @TaxWiser

Giant said:

@Skylar @TaxWiser

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@Skylar pls tag someone who can help @TaxWiser

@shavirbansal @nikhilchauhan guys do you uave any suggestions

Bro, if your Aditya Birla loan is floating rate and it’s in your individual name, then as per RBI rules, no bank or NBFC can charge foreclosure or prepayment penalty. So that 4% charge (which is around ₹1.75 lakh on ₹43.8L) should not be applicable.
First, check your sanction letter / loan agreement and confirm whether the loan is floating or fixed.
If it’s floating:
1. Tell Aditya Birla to waive the foreclosure charges and mention RBI guidelines.
2. Ask them to give this demand in writing with justification.
3. If they still refuse, raise a complaint with their grievance cell and then to the RBI Ombudsman. In most cases, the bank/NBFC backs off.
If it’s fixed rate: Then foreclosure charges are usually allowed as per the agreement. In that case, calculate whether shifting to the 7.7% loan still makes sense after paying the penalty.
Bottom line: Don’t pay 4% blindly. First confirm floating vs fixed. If floating, fight it and escalate.

AbhijeetSingh.CO said:

Bro, if your Aditya Birla loan is floating rate and it’s in your individual name, then as per RBI rules, no bank or NBFC can charge foreclosure or prepayment penalty. So that 4% charge (which is around ₹1.75 lakh on ₹43.8L) should not be applicable.
First, check your sanction letter / loan agreement and confirm whether the loan is floating or fixed.
If it’s floating:
1. Tell Aditya Birla to waive the foreclosure charges and mention RBI guidelines.
2. Ask them to give this demand in writing with justification.
3. If they still refuse, raise a complaint with their grievance cell and then to the RBI Ombudsman. In most cases, the bank/NBFC backs off.
If it’s fixed rate: Then foreclosure charges are usually allowed as per the agreement. In that case, calculate whether shifting to the 7.7% loan still makes sense after paying the penalty.
Bottom line: Don’t pay 4% blindly. First confirm floating vs fixed. If floating, fight it and escalate.

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Thanks for your reply
In agreement its mentioned as LAP on floating intrest rate so i don't think foreclosure charges should be there

Bro, if your loan agreement clearly says the interest rate is floating, then honestly you are on very strong ground here. As per RBI guidelines, banks and NBFCs are not allowed to charge any foreclosure or prepayment penalty on floating-rate loans taken by individual borrowers. So Aditya Birla asking for 4% foreclosure charges is not right in this case. On an outstanding of around ₹43.8 lakh, 4% is roughly ₹1.75 lakh, which is a huge amount and makes no sense when you’re shifting to a cheaper loan at 7.7%.
The first thing you should do is not agree verbally to pay anything. Ask them to explain this charge in writing (email or letter) and also tell them clearly that your loan is on floating rate and as per RBI rules, no foreclosure charges should apply. Many times, once they see you know the rule and you’re asking for written justification, they either waive the charge or reduce it to zero.
If they still don’t listen, then escalate it properly: first to Aditya Birla’s grievance / nodal officer. Attach your loan agreement page showing “floating rate” and their demand for 4%. If that also doesn’t work, you can file a complaint with the RBI Ombudsman. In most genuine cases like this, the lender backs off because RBI guidelines are quite clear on floating-rate loans.
Only situation where you’d be forced to pay is if the loan was fixed rate or in the name of a company/firm. But since your agreement says floating, you should not pay this 4% blindly. Fight it properly, keep everything on email, and escalate if needed. You can easily save yourself around ₹1.75 lakh just by pushing this the right way.
In short: floating rate = no foreclosure charges. Tell them to waive it, and if they don’t, escalate confidently.