Personal loan

Dear Client,
A borrower of a loan is held personally liable for his or her debt for non-payment of the outstanding amount of the loan and legally, there is no escape route to get rid of that liability. Even in the absence of a borrower or guarantor his or her surviving legal heirs are held liable to write off the debt from the asset or property they inherited from the deceased borrower. You can try to negotiate a debt settlement on your own (under OTS- One-time settlement scheme) if your pocket permits. But sometimes, it's typically done through third parties like debt relief companies, which you may hire to negotiate the settlement matter with the lender on your behalf. With this method, you will make payments to the debt settlement company rather than your creditors/lenders, along with the payment of fees or service charges. Debt settlement is an agreement between a lender Bank and a borrower in which the borrower repays a portion of a loan balance and the lender forgives the balance. You may consider starting the negotiation by offering to pay 25% or 30% of your outstanding balance in return for forgiveness on the rest. However, it may be noted that while there are legitimate debt relief/settlement companies, there are also many fraud/scam operations. So, if you're considering one, the Consumer Financial Protection Bureau(CFPB) suggests contacting your state Attorney General's(AG) office and local consumer protection agency to ask if they have any consumer complaints pending on file about that company. Some states require that debt settlement companies be licensed, which may provide some added protection. Although a debt settlement can offload some of your financial burdens, there are also a few potential risks and downsides to consider. First, a debt settlement will affect your credit score in CIBIL. That will make it more difficult for you to get credit or good interest rates in the future. Another potential drawback is that when you settle debt, you could face tax consequences. Finally, when you settle a debt with a credit card company, your account is closed once the settlement is complete. So you could potentially have no credit facility to use a credit card further owing to your poor credit (CIBIL) score. Further, a quick counseling session with a certified credit counselor can help you discover your options and choose the right path forward.

Dear Client,

If you are not able to pay your personal loan kindly reach out to the lender and explain your situation. Many lenders are willing to work with borrowers who are facing financial difficulties. They may offer you options like a temporary forbearance, a payment extension, or possibly modifying your loan terms.
If you're unsure about how to proceed, a counselor can help guide you through the options available. Some nonprofit organizations offer free counseling services.