Make an application for one time settlement
2) request bank to settle for principal amount and sell the properties given as collateral securities
3) legally you cannot force bank to waive interest
Bank taking possession of property
Hello, My father retired from the Army, after serving for ~30 years. His friend at that time was doing a construction business and asked my father if wants to partner him. Father trusted him and joined him and invested money. They took a loan of ~1.2cr as well. The business shut down, couldn't pay interest and bank is now selling two properties (one in the name of each partner) which was kept as collateral. Additionally, they are saying they can't cover the full amount with this (since interest component has been added) and hence want to attach another property (a house plus land from my father), since his partner doesn't have anything else on his name. How to deal with this? Can the interest component be written off? My father is now sulfuring only because he had more properties to his name. We have one buyer for my father 's property which was given as collateral but no buyers yet for his friend's property, which the bank wants to auction off and sell at whatever price they get and then recover the remaining by selling my father's house which was not under collateral.
Asked 3 years ago in Property Law
Religion: Hindu
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6 Answers
Please clarify whether the bank has initiated the recovery proceedings under the SARFAESI Act by issuing any possession and/or sale notice to your father or it is under an EP (execution proceedings) of a court decree obtained by the bank. In any case, your father may negotiate with the bank on a 'without prejudice' basis for exploring a settlement. Your father may very well ask for interest reduction or waiver, explaining his current financial status. He may also move for a stay of possession and sale of his property, through a local lawyer.
Dear client,
You can try to negotiate this with the bank as their actions seem biased against your father's interests although he was a joint partner.
Thank you
The property which have not been given as collateral security cannot be attached by bank without an order by court.
They may have to file a suit for recovery and can seek attachment of the other property if the debtor fails to repay the balance amount.
Hence your father can dispose his other property in advance before the bank is taking an action on this property also.
It can only be written off by bank or in settlement. You can seek a stay from court if you find the recovery proceedings are illegal
- As per the RBI, the bank should give proper time and offers for the settlement of loan amount., on the ground of health and sudden loss.
- Since, the said loan is in the name of both of them , then both are liable to refund the loan amount equally and bank cannot attach the full amount from one co-borrower.
- Further , to recover the amount from the property which is given as security cannot be attached by the bank without getting a court order.
- Further, your father having his right to sell that property to adjust the amount of the bank.
