I took multiple personal and credit card loans
6 months ago
Hello, i am from Mumbai. In last 1.5 years or so i took multiple personal and credit card loans which amounts to around 1.10 cr. Personal Loan amounts to around 65 lacs and Credit Card balances to around 45 lacs. I work for a reputed company with a salary decent to survive. Till now i.e. Oct'23, i have managed to pay EMI's and Min due on all loans and cards without defaulting. However, next month onwards it wont be possible for me pay these EMI's and Min dues. So far i have managed with to pay using credit limit available on credit cards but now they have exhausted as interests have eaten up that money. I stay on rent and have no property or assets which i can sell off to pay these loans. Hence, need guidance and help with filing Bankruptcy at the earliest to avoid distress from banks
To initiate bankruptcy proceedings, a debtor or creditor may file a petition with the National Company Law Tribunal (NCLT). The NCLT appoints an interim resolution professional to assess the debtor's financial situation and negotiate with creditors. If a resolution plan is not agreed upon during the IRP, the debtor may be declared bankrupt, and their assets will be liquidated to repay creditors. Individual Voluntary Bankruptcy is another option where you can file for bankruptcy voluntarily. You would need to approach the Debt Recovery Tribunal (DRT) for this purpose. In this case, you need to prove that you are unable to repay your debts. Collect all relevant financial documents, including loan agreements, credit card statements, income records, and asset details. This information will be crucial during the bankruptcy proceedings.
In the prevailing situation, you may file for bankruptcy. 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 to resolve or settle the matter.
Repayment of loans and credit cards
Multiple unsecured loan defaults
Unfreeze
For bank loan
Bankruptcy and Debt
