The time period given incorrectly

701 votes

From the facts stated, in long-term housing or personal loans the EMI is structured so that the initial payments largely cover interest and only a smaller portion reduces the principal. Therefore, even after several years of regular EMI payments, the outstanding principal may still remain substantial. This is a normal feature of amortized loan schedules. However, if the loan statement now shows 337 months tenure with 216 months remaining, despite the loan originally being sanctioned for 25 years, you should immediately verify whether there has been any restructuring, interest rate revision, penal interest, missed instalments, or recalculation by the bank, as these factors can extend the effective tenure and increase the outstanding amount. Before closing the loan, you should formally request the bank to provide: • Detailed loan statement from inception • Amortization schedule • Break-up of principal, interest, and any penal charges • Foreclosure statement / loan closure amount If there is any discrepancy or unjustified charges, you are entitled to raise a written complaint with the bank and, if necessary, escalate the matter to the Banking Ombudsman (RBI) for examination. Therefore, obtain the complete statement and verify the calculation before making the final payment to ensure that the closure amount is accurate and legally justified.

Advocate Pavani Kumari LawRato