Hypothecation Removal Service
Effortless and reliable support for removing bank hypothecation from your vehicle RC after loan closure.
Hypothecation Removal
After a vehicle loan is repaid, it’s essential to update your RC by removing the bank's hypothecation. We make the process smooth by preparing forms, collecting NOCs from banks, and completing RTO submissions without delays.
We ensure accurate documentation, challan checks, bank NOC verification, and timely coordination with the RTO so your RC reflects full ownership under your name.
Legal Process for Hypothecation Removal (Section 51)
Recording of Hypothecation at Registration
When a vehicle is registered under a hire-purchase, lease, or hypothecation agreement,
the RTO must record the financier’s details in the Registration Certificate (RC) at the time of
registration. This officially protects the financier’s interest in the vehicle.
(Ref: Section 51(1))
Cancellation of Hypothecation Entry
After the loan or agreement ends, the vehicle owner may apply for removal of the hypothecation entry.
The RTO will cancel the entry only after verifying all required documents, including loan closure proof
and financier clearance.
(Ref: Section 51(3))
Mandatory Financier NOC and Timelines
The financier must issue or refuse the No Objection Certificate (NOC) within
7 days of receiving the owner’s request. If the financier does not respond within
this period, the NOC is legally treated as deemed to be issued, allowing the owner
to proceed with hypothecation removal.
(Ref: Section 51(7))
RTO’s Discretion in Approval or Rejection
If the financier refuses to issue the NOC, the RTO must conduct a hearing to give the applicant an
opportunity to be heard. Only after this hearing can the RTO decide whether to approve or reject the
hypothecation cancellation request.
(Ref: Section 51(9))
Mandatory Communication to Financier After Changes
Whenever any hypothecation-related entry—addition, removal, or ownership transfer—is made in the
Registration Certificate (RC), the RTO must inform the financier through registered post with acknowledgment.
This ensures that all updates are officially recorded with the financing institution as well.
(Ref: Section 51(10) & Section 51(11))
What We Deliver
Bank NOC & Document Verification
Review of bank-issued NOC, Form 35, insurance, RC, and loan closure documents.
Form Preparation & Submission
Accurate preparation of Form 35 and paperwork required for hypothecation removal.
RTO Submission & Follow-Ups
Complete handling of form submission and regular follow-ups for approval.
Updated RC Issuance
Tracking and delivery of the updated RC showing hypothecation removed.
Our Process
Verify Documents & Loan Closure Proof
We verify RC, insurance, identity proof, and loan closure documents to ensure everything is in order.
Collect & Validate Bank NOC
We collect the bank NOC and Form 35 and check that all details match RTO records.
Prepare Form 35 & Submit at RTO
Forms are accurately filled and submitted at the concerned RTO along with supporting documents.
RTO Verification & Approval
RTO verifies bank NOC, loan status, and ownership details before approving hypothecation removal.
Receive Updated RC (Smart Card / DigiLocker)
Once approved, the updated RC without hypothecation is issued as a smart card or digital copy in DigiLocker.
Frequently Asked Questions
Common questions about hypothecation removal under Section 51 of the Motor Vehicles Act
It is an entry showing the vehicle is under a hire-purchase, lease, or hypothecation agreement. (Ref: Section 51(1))
At the time of registration, the RTO must record the existence of such agreement. (See Section 51(1), MV Act)
Yes, when the agreement ends, cancellation of the entry can be requested. (As per Section 51(3))
The financier must issue the NOC within 7 days. (Reference: Section 51(7))
If no refusal or communication within 7 days, the NOC is deemed issued. (Ref: Section 51(7))
Yes, the RTO must communicate such entries by registered post. (See Section 51(10))
Yes. Application for duplicate RC must include the financier’s NOC. (Under Section 51(8) & 51(9))
Yes. A no objection certificate from the financier is mandatory for re-registration in another State. (Ref: Section 47, Proviso 2)
Yes, particularly when the financier has refused NOC (after hearing both parties). (Reference: Section 51(9), MV Act)
Yes. Any transfer of ownership entry must be notified to the financier. (See Section 51(10))
It means the authority empowered to issue duplicate RC or assign a new registration mark. (Ref: Section 51, Explanation)