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Query on student/education loan

(Querist) 18 December 2017 This query is : Resolved 
My query is to understand student loan before approaching an institution.
Student loan is needed for the education of my nephew.

* Is it always necessary to mortgage a property for student loan? Could you clarify with the help of some concrete examples?

If mortgage is necessary, I will have to mortgage my property because student's parents don't have any property to mortgage.

That's why some more questions as below.

* Will the loan be given to the student directly with him as first applicant (I am not sure if there is something like first applicant, second applicant etc. or not)?
* Will my name be added in the loan application or in a separate application? If not, how will I and/or my property be linked with the loan? Will I have to submit original papers of the property to the bank with some signed agreements? What will be the link between this agreement, if any, and the student loan?

Because it will be difficult to know at the time of application what the amount of first salary will be, how soon the student will/can be able to pay back the loan, etc. that's why few questions as below.

* From when will the loan repayments start, for example after the completion of studies, after the start of first job, etc.?
* When will the monthly installment amount be decided, for example already at the time of application, after the completion of studies, after the start of first job, etc.?
* When will the tenure for paying back the loan be decided, for example already at the time of application, after the completion of studies, after the start of first job, etc.?
* Can the start of installment payments be delayed (by agreement already at the time of application, or later), for example if the student wants to pursure some further studies after the completion of the studies for which loan was taken?

I would also like to understand the risk for me because my property will be mortgaged.

* Can the student escape easily from paying back the loan by simply saying No (refusing) to the bank for paying back the loan even if he has a job?
* Will the bank have to try every possibility to recover the money from him or his parents before using my property to recover the loan? What are those possibilities?
* Is the bank obliged to try all possible options including legal route (court cases) against the student and/or his parents before using my property to recover the loan?
* Will the bank need court's permission before using my property to recover the loan?
* What can be my point of defence taking into account that I may not have easy and direct access to records related to student's job or salary to prove that he is in a position to pay back the loan but he is not paying? Or I won't be able to keep my property if student simply doesn't pay back the loan?

Thank you.
Sudhir Kumar, Advocate (Expert) 18 December 2017
the query is at wrong place.

Meet bank manager from where you intend to get loan.
Kumar Doab (Expert) 18 December 2017
You have posted that:
* Can the student escape easily from paying back the loan by simply saying No (refusing) to the bank for paying back the loan even if he has a job?
NO.

Now query may be read backward or forward.
Prem Dhawan (Querist) 18 December 2017
Answer from Mr Kumar is meaningful but too short. Unfortunately, legal issues are not as simple as Yes or No :)

Could you please elaborate more on the legal obligations for the student who takes the loan and risk for the guarantor who mortgages his property?

* Is the student (legally) obliged to pay back the loan himself if he has a job or is in a position to get a job?

* Will the bank have to try every legal possibility to recover the money from him or his parents before using
my property to recover the loan? What are those possibilities?

* Is the bank obliged to try all possible options including legal route (court cases) against the student
and/or his parents before using my property to recover the loan?

* Will the bank need court’s permission before using my property to recover the loan?

* What can be my point of defence taking into account that I may not have easy and direct access to
records related to student’s job or salary to prove that he is in a position to pay back the loan but he is
not paying? Or I won’t be able to keep my property if student simply doesn’t pay back the loan?
Sudhir Kumar, Advocate (Expert) 19 December 2017
This forum can help those who have a legal problem.

In this case the person appears to be applying for loan and intending to know how best he can evade refund. This forum doe snot encourage such activity.
Dr J C Vashista (Expert) 19 December 2017
Too long a story without any dispute to be advised by legal experts.
Dr J C Vashista (Expert) 19 December 2017
Contact a Bank manager.
Kumar Doab (Expert) 19 December 2017
Query; *Could you please elaborate more on the legal obligations for the student who takes the loan and risk for the guarantor who mortgages his property?

The secured lender has protected interest and can proceed per procedure.
The lender bank must have kept details of student loan on IT’s website.

Kumar Doab (Expert) 19 December 2017
Without any need for sarcasm Mr. Sudhir Kumar the querist has not posted that he want to run away and won't pay back the loan?
Prem Dhawan (Querist) 20 December 2017
Thankful only to Mr Kumar Doab for his contribution.

Others replies are as good as nothing; actually worse.

@ Mr Kumar Doab, As mentioned before, purpose of asking these questions is to understand my risks because I will mortgage my property.
I want to be sure that the law demands the bank to exhaust all possible options, including legal, towards the student and/or his parents before using my property or me to recover the loan.
But so far I dan't have clarity that loan will have to be paid by the student.

From bank's point of view the loan will be secured because my property will be mortgaged.
But can the bank take the easier route of recovering their money by selling my property if student refuses to payback?
If yes, then no one should mortgage his/her property to get loan for someone else.
Sudhir Kumar, Advocate (Expert) 20 December 2017
He is yet to get a loan and want to know the legal operations that may follow on his default.
Prem Dhawan (Querist) 20 December 2017
Regarding the last comment on my topic, same person and same unintelligent comment again.
May be this person has never heard the words like pro-activeness, be safe than sorry and likewise.
Or may be this person doesn't understand the queries in English.
I ignore him.
Sudhir Kumar, Advocate (Expert) 20 December 2017
loan applicant is safest when he repays.
Prem Dhawan (Querist) 21 December 2017
As mentioned before, purpose of asking these questions is to understand my risks because I will mortgage my property.
I want to be sure that the law demands the bank to exhaust all possible options, including legal, towards the student and/or his parents before using my property or me to recover the loan.

But so far I don’t have clarity that loan will have to be paid by the student or he will be able to escape easily putting me and my property at risk.

From bank’s point of view the loan will be secured because my property will be mortgaged.
But can the bank take the easier route of recovering their money by selling my property if student refuses to payback?
If yes, then no one should mortgage his/her property to get loan for someone else.
Sudhir Kumar, Advocate (Expert) 22 December 2017
Very clear.

Bank will sell mortgaged property is loan is not refunded.

You are not making it at all clear whether you are the student your self for whom loan is needed or you are guarantor of the loan. You also not want to make it clear how you are related to the student.

Do not expect sound and correct advise on riddles.
Prem Dhawan (Querist) 25 December 2017
Based on the previous reply, I can say that the responder didn't read my query/post properly or may be he doesn't understand English very well. Everything was well explained.
All previous replies on this post, from the same responder were not helpful either.

Anyhow, I have found answers to my questions from other sources.


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