You folks have been a guiding beacon in setting me straight with my ongoing battle with my local bank. Would you kindly check out the following please?
I had approached a nationalized bank for a housing loan. My loan was sanctioned, but not as a conventional mortgage term loan. Instead I was sanctioned credit facilities under Advances to SME segment by way of a letter of arrangement with working capital limits by way of reduction in drawing power in Cash-Credit account for a period of 24 months. Further the account involved a margin clause whereby I had to match 50% of any withdrawal with my own funds. In retrospect it seems ridiculous that I signed up to it. I was convinced by the bank manager that this was a popular loan and quicker than conventional mortgage and also eligible for an extension of further 2 years, after which it would be much easier to convert to a conventional loan. Also, no repayment of loan was needed until the 24 months.
A month later a builder called claiming to be referred by the manager. He wanted me to enter into a joint venture with him. I was not interested. At a future time the manager himself suggested that it would be hassle free for me if I enter into a joint development venture with the builder. I still was not interested.
I thought it was prudent to pay down the principal amount even during the moratorium period. I had paid back close to half the money taken out from the bank when the 24 month period of over. The bank manager refused to take any more payments, refused to extend the loan period and demanded that I pay back the entire outstanding amount. The builder and someone claiming to be a financier now started pestering me to sell away the building. I had a letter of interest from a potential tenant for the building. The bank would not convert the loan into a regular mortgage with the rents paying for the mortgage. A few months later is when I came to know that the bank had initiated action under Sarfaesi Act when they came to paste the Symbolic possession notice and a writ is now pending before the High Court detailed in my previous thread "Sarfaesi Act: DRT or DRAT"
I had written to the bank requesting an OTS settlement. It was refused since there was no such scheme in place. Subsequently I came across a paper advertisement for a OTS scheme for the SME segment. I wrote the bank. This time they declined stating that it is not applicable in my case, without assigning any reason. All documents and Sarfaesi notices refer to my account as an SME. I am at a loss as to what course of action I should follow and in what forum.
1. 1. I could approach the banking ombudsman, but I understand they may not entertain it since Sarfaesi action has been initiated even though OTS is not an issue being raised in the DRT/DRAT.
2. 2. Could a separate writ be filed in High Court for compliance of the SME OTS?
3. 3. I am convinced that there is something rotten about the whole situation. How could an ordinary residential building be considered an SME? Is there any way that this could be converted into a regular term loan and who be the compelling authority who could intervene in this matter?
