Gold loan mortgage
Kay Abreu
(Querist) 16 February 2016
This query is : Resolved
An NBFC amongst other business interest is also in the business of offering loans against mortgage of gold jewellery at 70% of its value at interest rates prevalent at that point of time. Now that the value of gold is sliding down they have asked customers to renew their gold loan by paying up a part of the loan advanced to bring the loan at par with current gold prices. In other words, loan to value. They have cited RBI regulations but have not provided any documentary evidence. They are refusing to accept the interest on the gold loan taken since the last 3 months till part-payment of the loan is made. That means compounded interest along with part-payment will need to be paid. They enjoyed interest at higher rates when gold prices were high; and now when gold prices are down they want customers to liquidate a part of their gold loan. Such loans are taken to tide over an emergency. Please let me know the legal position ?
Rajendra K Goyal
(Expert) 17 February 2016
No financier would like to put its stake / loan provided in risk, and would take steps to cover the risk.
If the procedure is against some law / RBI guidelines you can proceed legally other wise you can not check the company to harvest maximum benefit under current law with competition.
