Home loan tenure reduced without informing, EMI increased.

Question

Home loan tenure reduced without informing, EMI increased.

14-May-2026 (In Recovery Law)

I took a home loan from an NBFC for property in construction. Total loan approved is Rs. 8137000/- with 15 years of tenure. They had bundled an insurance plan with the loan, which the sales person falsely mentioned would cost 200 Rupees per month. When we found total cost of insurance was Rs. 2,14,057 we asked to cancel. The cancellation was processed and considered as part payment. The tenure was reduced from 180 months to 117 months. Now EMI is very high. Company refuses to increase tenure.

Answers (3)

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Advocate Aishwarya Rajput LawRato · Accepted Answer · 2026-06-04T16:06:18+05:30

Answer #2

If the insurance policy was misrepresented or bundled without informed consent, and its cancellation has unfairly reduced the loan tenure from 180 months to 117 months, you may raise a written grievance with the NBFC seeking restoration of the original tenure or loan restructuring. If the grievance is not resolved, you may approach the NBFC’s Grievance Redressal Officer and thereafter file a complaint before the RBI Integrated Ombudsman alleging unfair lending practices and mis-selling of insurance. You may also seek compensation for deficiency in service and unfair trade practices before the Consumer Commission, subject to the facts and documents on record.

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Advocate Sanket Ganpat Khamkar LawRato · Accepted Answer · 2026-06-13T06:23:54+05:30

Answer #3

From the facts stated, if the insurance product was bundled with the loan and its cost or implications were not properly disclosed, the issue may amount to misrepresentation or deficiency in service. Further, if the insurance cancellation amount was adjusted towards the loan in a manner that substantially reduced the tenure and increased the EMI without your informed consent, the matter requires careful examination. You should immediately obtain the loan agreement, insurance policy documents, cancellation request, and the revised amortization schedule from the NBFC. The legality of the lender's refusal to restore the original tenure will depend upon the contractual terms and the manner in which the adjustment was carried out. Kindly share the complete loan and insurance documents for a detailed legal opinion and assessment of the remedies available against the NBFC.

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