I have a loan debt if 1.90 lacs. I have lost my job. Bank has filed a case for recovery. I do not have money for settlement also as I have borrowed money already. What should i do please guide.
Ans: Your financial challenges are significant, but they can be managed. Focus on a step-by-step plan to resolve the loan issue and stabilise your finances.
1. Understand the Loan Case Filed
Verify the type of case filed by the bank.
Review the loan documents to understand your rights and obligations.
Check if the bank has issued any prior notices.
2. Communicate with the Bank
Contact the bank's recovery department directly.
Explain your job loss and current financial situation honestly.
Request a temporary freeze on repayment or a restructuring of the loan.
3. Explore Loan Restructuring Options
Banks may offer loan restructuring for genuine hardships.
Restructuring can include reducing EMIs, extending tenure, or pausing payments temporarily.
Emphasise your willingness to repay once your situation improves.
4. Seek Help from a Debt Counsellor
Debt counselling organisations can mediate with the bank on your behalf.
They help negotiate manageable repayment terms and reduce pressure from recovery agents.
5. Look for Temporary Income Sources
Identify immediate opportunities for earning, like freelance work or part-time jobs.
Even small income can help you make token payments to show your intent to repay.
Leverage any skills or resources you have to generate income quickly.
6. Avoid Further Borrowing
Stop taking new loans or borrowing from friends and family.
Additional debt will worsen your financial burden.
Focus on stabilising your current situation first.
7. Understand Legal Implications
Banks cannot harass you through illegal means or use unfair recovery practices.
If harassed, you can file a complaint with the banking ombudsman.
Consult a lawyer if you receive court summons or other legal notices.
8. Liquidate Unnecessary Assets
Evaluate if you have assets that can be sold to partially repay the loan.
Assets like gold, electronics, or unused items can provide immediate relief.
Prioritise using non-essential assets to avoid affecting your basic needs.
9. Prioritise Essential Expenses
Manage your available funds to cover essentials like food, rent, and utilities.
Avoid diverting these funds entirely for debt repayment.
10. Seek Emotional Support
Share your situation with trusted family or friends for emotional support.
Stress can affect decision-making, so seek guidance from those you trust.
Stay motivated and focused on improving your circumstances.
Finally
Your current challenges require resilience and a structured plan. Reach out to the bank, seek help from counsellors, and focus on temporary income. With patience and effort, you can overcome this phase.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment