Loan EMI Bounce? Fine from bank account seal to ₹ 50,000 and legal notice - Know full details now
Taking a loan has become a common practice, but the consequences of non -payment of loan can be very serious. When a person is not able to repay the loan EMI on time, he is considered a loan default. In this situation, the bank can take many legal action.
here we Will tell you what action the bank can take if you do not repay the loan And what are your rights.
Before taking a loan, it is very important to know what action can be taken against you if you are unable to repay the loan. Bank first sends notice to you And then legal action can be initiated.
In addition, the bank can confiscate your property or deduct from your salary. Therefore, it is very important to properly assess your financial situation before taking a loan.।
The consequences of non -payment of loan are not only economic, but it also has a negative effect on your credit score. This can make it difficult for you to get a loan in future. Therefore, all aspects should be considered before deciding to take a loan.
Description of the process of loan default
| Phase of action | Details |
| Send notice | The bank sends notice to the borrower to pay loans installments. |
| Appointment of recovery agents | If the borrower does not pay even after notice, the bank takes the help of recovery agents. |
| Property seizure under Sarfaesi Act | The bank can seize the mortgaged property and recover the outstanding amount by selling it. |
| File a case in court | The bank can file a case against the borrower in the court and prosecute a civil case. |
| Impact on credit score | Loan default can spoil your credit score, which makes it difficult to get a loan in the future. |
| Deduction from pay | The bank can also cut from your salary if you are unable to repay the loan installments. |
| Late payment fee | Late payment fee can be levied if the loan installments are not repaid on time. |
Legal aspects of loan default
Not repaying a loan is not a legal offense, but if a person does not deliberately pay a loan, he can be booked under criminal betrayal. A case can also be registered under Section 420 of the Indian Penal Code, In which there is a provision of imprisonment.
Action under criminal betrayal
- Section 316, Indian Code of Justice: If a person misuses the money given by the bank or misuses it, he can be registered under criminal betrayal.
- Punishment: Under this section, there is a provision of jail, fine, or both if found guilty.
Loan default results
The consequences of non -payment of loan can be very serious. This not only negatively impacts your financial situation, but can also spoil your credit scoreThis can make it difficult for you to get a loan in future. In addition, the bank can confiscate your property and deduct from your salary.
Ways to avoid loan default
- Make financial plans: Properly assess your financial situation before taking a loan and make a financial plan.
- Regular payment: Pay the loan installments on time.
- Contact the bank: If you are not able to pay, contact the bank and request to extend the date of payment.
- One-time settlement: In some cases, the bank may offer one-time settlement option, in which you can settle the loan by paying a lump sum.
Loan takers rights
- Right to respond to notice: If the bank sends you a notice, you have the right to answer it.
- Right to take legal advice: You can take legal advice and protect your rights.
- Complaint with banking umbdsman: If the bank does not pay attention to your complaint, then you can complain to the banking ombudsman.
Recovery agents limits
- Deadline: They can contact only from 7 am to 7 pm.
- Threatening or intimidation forbidden: They do not have the right to threaten or intimidate the customer.
- Right to Complaint: If the agent misbehaves, you can file a complaint with the bank.
conclusion
The consequences of non -payment of loan can be very serious. Therefore, it is very important to properly assess your financial situation and pay on time before taking a loan. If you are not able to pay, contact the bank and request to extend the payment date।
In addition, keep knowledge of your rights and seek legal advice if needed.
Disclaimer: This article is for general information and is not an alternative to any specific legal advice. It would be appropriate to consult your financial advisor or lawyer before taking a loan. Loan default is a real and serious issue that can result very serious.