Loan On Farm
If you remember, the previous owner of our farm had a loan on the farm. They obtained the loan from a cooperative bank. At the time of registration, the agreement between us was that they will clear the loan once they receive money from us on the registration date. Once they repay the bank loan, the bank is supposed to report it to the Tahsildar office and the loan record is supposed to be cleared from our land documents. But it was easier said than done. Before receiving money, everyone agrees to all kinds of conditions. Once the money changes hands, we have to run behind them to get the things to which they agreed to do so willingly and cheerfully.
In one of the previous posts, I mentioned that the farm we were about to purchase had a loan. We knew it but when talking to the real estate agent and the owner of the farm, it felt like it should be an easy fix. They said once they receive the money after registration, the first thing they will do is clear the bank loan and get everything cleared on our land records. They did not make it as easy as they made it sound once the transaction was complete. Thankfully, I think our real estate agent Mr. J probably knew that these farmers play these kind of tricks. He did not give the seller the full cash. He kept some with him and told them that they will receive the rest only once they clear the loan.
After the registration, we waited and waited for the loan to be cleared but nothing happened. We were in contact with Mr. J to make sure he is working with them to clear the loan. Four months passed by and still nothing. Eventually Mr. J has to visit the old owners and find out what was going on. It seems, the farmers were hoping that after the elections the newly elected government will “maafi” (clear) their loans. They were banking on that happening and pocketing the money we paid to clear their loans. There is no limit to greed I suppose. Since the registration was completed, the loan is now on our name, as if we took the loan on the land. So we were worried about it.
It’s been a while since the new government has formed and there were no announcements of clearing loans for the farmers. So they had no choice but to clear the loan. Yet they were slow to take action. Eventually Mr. J had to visit them and take them to the bank and got the loan cleared. He sent us a copy from the bank showing that the loan was cleared from the bank’s side. That information is supposed to be passed on to the Taluk office so the lien on our farm can be lifted. We would check the land records everyday to see if the loan was cleared or not.
We heard of stories from friends who purchased a farm who could not get the land records cleared because there was some miscommunication between the banks and Taluk office. So even though the bank received the loan amount and gave the slip which says so, the lien still stayed on the land records. We were worried if we will face the same fate. It supposedly takes 2 weeks for the communication from the bank to Taluk office to happen and the records updated. This was a trying time for us. The process is very opaque and you wouldn’t know the progress. No one knows if the slip didn’t reach the Taluk office, or if there is discrepancy in the details of loan and land records, or if the Taluk officer accepted it, or if they failed to update the records etc.
After checking the land records everyday for several days, eventually one day, out of the blue, the records stopped showing the lien and debts on our land. Phew! That was a relief. We partied hard that day :). After registration, this was our second celebration. It eventually took a total of 6 months from the time of registration to the time when the land records were cleared. So be warned if you are entering into this kind of arrangement when you are purchasing a land.
Through this ordeal what I found out was that the farmers of today are not as innocent and ignorant as I thought. They know all the tricks in the books on how to cheat and extract maximum from the government and from other people. In fact every farmer I met was smarter than me (which is a very low bar since I am really an idiot and don’t have any street smarts) and smarter than most city folk. Believe me on that. I have yet to meet an innocent farmer that I had imagined in my mind. They have done all kind of atrocities including murder, illicit affairs, extreme drunkenness, eloping away with their lovers at a very young age (both male and female), squandering parents money over early pregnancy, etc etc, all while being not well educated. Except, they think they are well educated and smarter (which they are).