NOC to account statement: What you must do for loan closure process

Get no objection certificate from lender; have fresh encumbrance certificate issued by registrar

The Reserve Bank of India (RBI) recently issued new guidelines for standardising lending practices among banks, non-banking financial companies (NBFCs), and other regulated entities (REs). The directives address issues faced by borrowers, specifically the prompt release of property documents once a loan is repaid.

According to these guidelines, lenders must return all original property documents held as collateral within 30 days following the complete repayment of a loan. A RE will have to compensate a borrower at the rate of Rs 5,000 for every day of delay.

Explaining why the guidelines have been issued, Jay Thacker, member, Association of Registered