How to Complete RTO Hypothecation Removal Process Online for Buses

Paying off a bus loan is only the first step toward full ownership. Even after the final EMI, the Registration Certificate (RC) continues to show the lender’s name until the hypothecation entry is officially removed.

To gain complete legal ownership, bus owners must apply through the RTO hypothecation removal process online using the government’s Parivahan portal. This guide focuses on buses and heavy passenger commercial vehicles.

Why Bus RC Hypothecation Removal Is Necessary

When a bus is purchased through financing, the RTO records a hypothecation entry linking the vehicle to the bank. Clearing the loan does not automatically clear this record.

Without completing the Bus RC hypothecation removal, bus owners may face:

• Rejection of ownership transfer or resale applications
• Complications with commercial bus insurance claims
• Difficulty obtaining interstate movement or re-registration approvals
• Continued legal claim of the financier over the bus

To avoid these issues, it is essential to formally remove financer or bank name in RC once the loan is closed.

Documents Required to Remove Bus Loan Hypothecation

To begin the Parivahan hypothecation removal procedure, the following documents are required specifically for buses:

1. Form 35 (Two Copies)Jointly signed by the bus owner and the lending institution
2. No Objection Certificate (NOC) Issued by the bank confirming loan closure
3. Original Registration Certificate of the Bus
4. Valid Commercial Bus Insurance Certificate
5. PUC Certificate
6. Fitness Certificate (If Requested by RTO) Some RTOs require a valid FC for commercial buses during verification

These documents allow the RTO to verify and approve the request to remove bus loan hypothecation.

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Step-by-Step RTO Hypothecation Removal Process Online for Buses

The Ministry of Road Transport and Highways provides an online facility for hypothecation termination through the Parivahan (Vahan) platform.

Step 1: Access the Parivahan Portal

Visit the official Parivahan website and select the appropriate state.

Step 2: Enter Bus Registration Information

Provide the bus registration number and choose the relevant RTO.

Step 3: Select Hypothecation Termination Service

From the available online services, select Hypothecation Termination to proceed.

Step 4: Verify Vehicle Details

Enter the last five digits of the bus chassis number and confirm using the OTP sent to the registered mobile number.

Step 5: Submit Financier Termination Details

Choose the bank name and enter the NOC date to proceed with the removal of the hypothecation entry.

Step 6: Pay Applicable Fees

Complete the online payment of RTO hypothecation removal charges using the available payment options.

Step 7: Upload Supporting Documents

Upload scanned copies of Form 35, bank NOC, and insurance certificate.

Step 8: Visit RTO for Physical Submission (If Required)

Certain states require submission of original documents, including the bus RC and signed Form 35, for final verification.

Once approved, the RTO completes the Bus RC hypothecation removal process.

RTO Hypothecation Removal Charges for Buses

The RTO hypothecation removal charges for buses are relatively minimal and typically include:

• Hypothecation termination fee: ₹100–₹200
• Smart card or postal charges: ₹50–₹100

The total amount usually falls between ₹150 and ₹500, depending on state-specific RTO norms.

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Processing Time to Remove Bus Loan Hypothecation

After submission and verification:

• The standard processing time is 7 to 14 working days
• A fresh RC is issued without the financier’s name
• The updated RC is delivered to the registered address

How to Check RTO Hypothecation Removal Status for Bus RC

Applicants can track the RTO hypothecation removal status online without visiting the RTO office.

1. Visit the Parivahan portal
2. Select Know Your Application Status
3. Enter the application number

The system displays whether the request is pending, approved, or the RC has been printed.

Completing the RTO hypothecation removal process online is a mandatory legal requirement after closing a bus loan. It ensures undisputed ownership, smooth insurance handling, and freedom to sell or transfer the bus without restrictions.

Bus owners and fleet operators should complete the hypothecation removal process promptly to avoid operational and legal complications in the future.

Frequently Asked Questions