Settlement of loan
9 months ago
My husband has taken loan from different banks / financial institution for business purpose but for consequitive loss in business he is now unable to pay the huge emi every month. Is there any provision of law for settlement of the loans
A.Dear Client,
Informing your inability to pay the outstanding amount of the loan to the Bank you can opt for OTS (One Time Settlement) Scheme, Bank offered occasionally for loan defaulters extending some rebate on such kind of bad loan to get the loan settled in the prelitigation stage. You may take a chance if such OTS Scheme is now available with the Bank. Otherwise, you may request the Bank to put up the matter before LOK ADALAT arranged occasionally by Dist. Legal Service Authority to settle the dispute at the pre-litigation stage through mediation of parties. Reach out to an Advocate for guidance and steps.
Informing your inability to pay the outstanding amount of the loan to the Bank you can opt for OTS (One Time Settlement) Scheme, Bank offered occasionally for loan defaulters extending some rebate on such kind of bad loan to get the loan settled in the prelitigation stage. You may take a chance if such OTS Scheme is now available with the Bank. Otherwise, you may request the Bank to put up the matter before LOK ADALAT arranged occasionally by Dist. Legal Service Authority to settle the dispute at the pre-litigation stage through mediation of parties. Reach out to an Advocate for guidance and steps.
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A.Dear client,
If your husband has taken loans from various banks or financial institutions for business purposes but is now facing financial challenges due to consecutive losses in the business, there are some legal provisions that could offer potential relief or assistance in settling the loans. One option is loan restructuring, where he can negotiate with the lenders to modify the loan terms, such as extending the loan tenure or reducing the interest rate, to make the EMIs more manageable. Another possibility is debt settlement, wherein he can discuss with the lenders to pay a reduced lump sum amount to settle the debt. However, it's important to consider that debt settlement may impact his credit score and financial standing.
In more severe cases where other options are exhausted, the Insolvency and Bankruptcy Code (IBC) can provide a legal framework for resolving insolvency cases. This involves seeking resolution through the National Company Law Tribunal (NCLT), where both debtors and creditors can participate in the process. However, pursuing IBC should be a last resort, as it can have significant consequences on his financial situation.
Encouraging him to proactively communicate with the lenders is crucial. By explaining his financial difficulties and seeking their cooperation, some lenders may be willing to devise alternative repayment plans based on his circumstances.
If your husband has taken loans from various banks or financial institutions for business purposes but is now facing financial challenges due to consecutive losses in the business, there are some legal provisions that could offer potential relief or assistance in settling the loans. One option is loan restructuring, where he can negotiate with the lenders to modify the loan terms, such as extending the loan tenure or reducing the interest rate, to make the EMIs more manageable. Another possibility is debt settlement, wherein he can discuss with the lenders to pay a reduced lump sum amount to settle the debt. However, it's important to consider that debt settlement may impact his credit score and financial standing.
In more severe cases where other options are exhausted, the Insolvency and Bankruptcy Code (IBC) can provide a legal framework for resolving insolvency cases. This involves seeking resolution through the National Company Law Tribunal (NCLT), where both debtors and creditors can participate in the process. However, pursuing IBC should be a last resort, as it can have significant consequences on his financial situation.
Encouraging him to proactively communicate with the lenders is crucial. By explaining his financial difficulties and seeking their cooperation, some lenders may be willing to devise alternative repayment plans based on his circumstances.
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