Legal advise for loan recovery in case of loss of job
7 months ago
Hello sir,
I have 3 credit cards and e loan running in my name. It's been 6 months I have been laid off by my previous company and since then I am unable to find a new job. Somehow I manged to pay my emi for these 6 months but now I am going through tough financial crisis. I have informed all the banks about my situation and also asked for a grace period of 6 months so that I can find a job for myself and then resume to pay. But no bank is helping me on this. Since I was the only earning member of my family my family income is 0, thus paying minimum amount is also not an option for us.
Inspite of helping now the banks are harassing us. Can you please give us some legal advise on this?
A.Dear Client,
Under the Provincial Insolvency Act,1920, you can file for bankruptcy if you are unable to repay a debt greater than ₹500. After analyzing whether the conditions for filing of bankruptcy have been met, the court may accept or reject the application. Until the decision on the application is taken, an interim receiver takes possession of the property of the debtor. If the application is admitted, the court can apply a stay on any legal proceedings against the property or assets of the debtor. In other words, you can get a stay order against further recovery efforts by your creditors. Once your application is admitted, your property vests with the “receiver" appointed by the court. This official then distributes your assets among the creditors, unless a compromise proposed by you has been accepted by your creditors and the court. Once this process is completed, you will be “discharged from bankruptcy" by the court, giving you the opportunity to build your life and finances afresh, without being hounded by your previous creditors. Further, a quick counseling session with a certified credit counselor can help you to discover your options and choose the right path forward to resolve the crisis.
Under the Provincial Insolvency Act,1920, you can file for bankruptcy if you are unable to repay a debt greater than ₹500. After analyzing whether the conditions for filing of bankruptcy have been met, the court may accept or reject the application. Until the decision on the application is taken, an interim receiver takes possession of the property of the debtor. If the application is admitted, the court can apply a stay on any legal proceedings against the property or assets of the debtor. In other words, you can get a stay order against further recovery efforts by your creditors. Once your application is admitted, your property vests with the “receiver" appointed by the court. This official then distributes your assets among the creditors, unless a compromise proposed by you has been accepted by your creditors and the court. Once this process is completed, you will be “discharged from bankruptcy" by the court, giving you the opportunity to build your life and finances afresh, without being hounded by your previous creditors. Further, a quick counseling session with a certified credit counselor can help you to discover your options and choose the right path forward to resolve the crisis.
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A.Dear Client,
Here are some steps you can consider:
Contact the Banks Again: Continue to communicate with the banks, both in writing and over the phone, explaining your financial hardship in detail. Ask if they can offer any temporary relief measures, such as a temporary reduction in interest rates, waiver of late payment fees, or a repayment plan.
Consider Debt Consolidation: Debt consolidation is a process of combining multiple debts into one with a lower interest rate. It can make managing debt more manageable. Explore this option with your banks or financial institutions.
Consult a Credit Counseling Agency: Credit counseling agencies can help you create a debt management plan, negotiate with creditors, and provide financial education. Ensure that you choose a reputable agency, preferably one accredited by a recognized organization.
Seek Legal Advice: If you believe you are being harassed by the banks, it might be worth consulting with a lawyer who specializes in consumer debt or financial matters. They can assess whether your rights are being violated and advise you on possible legal actions.
Review Your Credit Card Terms: Carefully review the terms and conditions of your credit cards and loans to understand the consequences of non-payment. Some credit card agreements may allow for temporary hardship arrangements.
Explore Government Assistance Programs: Depending on your country, there may be government assistance programs or nonprofit organizations that provide support to individuals facing financial difficulties.
Financial Counseling: Consider seeking advice from a financial counselor or advisor who can help you create a budget and develop a plan to manage your finances during this challenging period.
Preserve Your Credit Score: While it may be challenging, try to avoid actions that severely damage your credit score, as it can impact your financial future. Discuss options with your financial advisor to minimize the impact on your credit.
Remember that each bank may have different policies and procedures for handling financial hardship. Continue to work with them to find a solution that works for your situation. If you feel harassed or unfairly treated, consult a lawyer who can provide guidance on your legal rights and options.
Thank you.
Here are some steps you can consider:
Contact the Banks Again: Continue to communicate with the banks, both in writing and over the phone, explaining your financial hardship in detail. Ask if they can offer any temporary relief measures, such as a temporary reduction in interest rates, waiver of late payment fees, or a repayment plan.
Consider Debt Consolidation: Debt consolidation is a process of combining multiple debts into one with a lower interest rate. It can make managing debt more manageable. Explore this option with your banks or financial institutions.
Consult a Credit Counseling Agency: Credit counseling agencies can help you create a debt management plan, negotiate with creditors, and provide financial education. Ensure that you choose a reputable agency, preferably one accredited by a recognized organization.
Seek Legal Advice: If you believe you are being harassed by the banks, it might be worth consulting with a lawyer who specializes in consumer debt or financial matters. They can assess whether your rights are being violated and advise you on possible legal actions.
Review Your Credit Card Terms: Carefully review the terms and conditions of your credit cards and loans to understand the consequences of non-payment. Some credit card agreements may allow for temporary hardship arrangements.
Explore Government Assistance Programs: Depending on your country, there may be government assistance programs or nonprofit organizations that provide support to individuals facing financial difficulties.
Financial Counseling: Consider seeking advice from a financial counselor or advisor who can help you create a budget and develop a plan to manage your finances during this challenging period.
Preserve Your Credit Score: While it may be challenging, try to avoid actions that severely damage your credit score, as it can impact your financial future. Discuss options with your financial advisor to minimize the impact on your credit.
Remember that each bank may have different policies and procedures for handling financial hardship. Continue to work with them to find a solution that works for your situation. If you feel harassed or unfairly treated, consult a lawyer who can provide guidance on your legal rights and options.
Thank you.
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