Educational loan - harassments by reliance arc

haran light (Querist) 24 April 2023 This query is : Resolved
My Cousin got a educational loan (Rs 330000) from SBI in 2008 for her Master degree. But disbursed amount is only Rs. 305000. Everything in her Father name. The bank employee told there is a insurance for the loan. But no document provided.

She completed her degree in 2010 and once she got job she paid 4000 to 10000 whenever and whatever possible. After her marriage also she paid some amount like this. In 2015 the NEFT payment to Education loan account rejected she stopped NEFT and planning to enquire the home branch when she visit native. But her father expired in the next month and she forgot the things. She tried NEFT once again and forgot as she don't have a job after that.

Suddenly last February Reliance ARC called her for the loan and telling they are now responsible for collecting the loan amount. There is no communication from Bank from 2015 regarding loan and transfer to Reliance ARC. Also no communication from Reliance ARC also. Now they are threatening she has to pay almost Rs 1000000.
Will file a case, update in CIBIL, write to a government office where she working as temporary employee how can they give job etc. Also threatening her husband's loan will also affect.

Loan sanctioned amount Rs .330000
Disbursed Amount Rs. 305000
Now as per RARC need to pay Rs 1000000
Total she paid including Govt. subsidy - Rs 220000

Also as her father expired the insurance which took for loan there is no information from RARC. She want to check with SBI on insurance but RARC is pushing to take decision on payment soon we cannot wait.

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A woman is experiencing aggressive debt collection tactics from Reliance ARC regarding an SBI education loan taken out by her father. Despite making payments for years, the loan amount has ballooned, and she is now being threatened with legal action and damage to her CIBIL score and government employment. She is seeking clarity on the loan's insurance policy and questioning the lack of communication from both SBI and Reliance ARC over the years.

Sudhir Kumar, Advocate (Expert) 25 April 2023
You have indicated that :-

1. She has unpaid loan

SHE HAS TO PAY, HER FATHER HAS DIED WHO COULD HAVE BEEN HAULED UP FOR DEFAULT AS IN SUCH LOAN PARENT IS TAKEN AS CO-BORROWER. INTERESTIS SWELLING WITH EACH MIDNIGHT

2. The loan was apparently insured.

IT IS A GOVT BANK AND SUCH INSURANCE AGREEMENT CAN BE TAKEN UNDER RTI.

GENERALLY SUCH INSURANCE DOES NOT INCLUDE DEFAULT AND CAN INCLUDE DEATH ONLY.

IN THIS CASE SHE IS APPRENTLY A CO-BORROWER AND IS LIABLE

3. She is being threatened legal proceedings .

SO SHE IS NOT BEING HARASSED. ELGAL PROCEEDING CAN BE FILED IF THE DEBT IS NOT TIME BARRED.

4. She is govt employee

YOU HAVE NOT INDICATED WHETHER SHE IS REGULAR (TEOMPRARY DURING PROBATION) OR AD-HOC EMPLOYEE.

HOWEVER IT IS PROFESSSIONAL MISCONDUCT FOR GOVT EMPLOYEE TO BE HABITUALLY INDEBTED.
FACTS GIVEN BY YOU INDICATE THAT SHE HAS NOT MADE EFFORTS TO PAY LOAN FOR LONG.

5. Loan recovery agency is writing to her department to object for her appointment.

THEY RIMA-FACIE HAVE NO BUSINESS OF JURISDCITION TO OBJECT TO HER GOVT EMPLOYMENT. HOWEVER, DEPART,MENT CAN TAKE NOTICEOF THE MATTER THAT AS A GOVT SERVANTSHE HAS A HUGE DEBT AND NOT PAYING AND TREAT HER HABITUALLY INDEBTED.

You have also indicated that she is getting Rs 4000-10000. You have also stated that she is govt employee. Both the facts cannot be believed together. Please give facts as to whether she is :-

1. Regular employee, have qualified recruitment procedure (then how she is getting so low).
2. Adhoc employee.
3. Outsourced
4. Dailywager.
Beware : half/false information can lead to wrong advise.

haran light (Querist) 25 April 2023
She is a Temporary Employee.

I didn't say she is getting 4000 to 10000. She used to repay the loan from 2011 to 2015 when she was working with a minimum amount of 4000 to a maximum amount of 10000.

She was paying the amount till 2015 via NEFT. It seems after SBI gave that to Reliance the NEFT transfer stopped working. Also, there is no communication from SBI or Reliance about this via postal or email.

When she checked the account number to pay cash in Chennai SBI told her there is no such account check with the Home branch. She missed it. No communication in the last 8 years from SBI and Reliance. If Reliance contacted her in 2015 or SBI informed her about the transfer of loan she definitely followed it and paid it monthly.

Here it seems they waited for years to make it a huge debt and came for collection now.

One more question is whether the insurance if it exists will repay some part of the loan right? Also, a friend working in PVT bank told Reliance ARC can check with SBI for the Insurance. But Reliance ARC is telling they cannot do.

Sudhir Kumar, Advocate (Expert) 26 April 2023
She is a Temporary Employee.

SO SHE IS A REGULAR EMPLOYEE AND PRESENTLY HAVING TEMPORARY STATUS DURING PROBATION AND TO BE DECLARED PERMANENT ON COMPLETION O FPROBATION

(CRORRECT ME IF I AM WRONG)

IN SUCH CASE IT IS VERY NECESSARY FOR HER TO ENSURED THAT SHE IS NOT CHARGESHEETED BY DEPTT FOR BEING HABITUALLY INDEBTED.

I didn't say she is getting 4000 to 10000. She used to repay the loan from 2011 to 2015 when she was working with a minimum amount of 4000 to a maximum amount of 10000.

SURIPRISING HOW ONE CAN GET LESS THAN MINIMUM WAGES ACT.

She was paying the amount till 2015 via NEFT.

HOW DID SHE PAY (OR ATEMPTED TO PAY) AFTER 2015?

It seems after SBI gave that to Reliance the NEFT transfer stopped working.

THIS WAS NO JUSTIFICATION TO STOP FURTHER PAYMENT LOAN DID NOT EXTINGUISH

Also, there is no communication from SBI or Reliance about this via postal or email. When she checked the account number to pay cash in Chennai SBI told her there is no such account check with the Home branch. She missed it.

SO SHE WAS ADVISED WELL AND DID NOT FOLLOW.

No communication in the last 8 years from SBI and Reliance. If Reliance contacted her in 2015 or SBI informed her about the transfer of loan she definitely followed it and paid it monthly.

THAT DOES NOT MEAN THAT LOAN ENDED

Here it seems they waited for years to make it a huge debt and came for collection now.

One more question is whether the insurance if it exists will repay some part of the loan right? Also, a friend working in PVT bank told Reliance ARC can check with SBI for the Insurance. But Reliance ARC is telling they cannot do.

WHN BORROWER HERSELF IS NOT AWARE OF INSURANCE CONTDITIONS THEN HOW RECOVERY AGENCY CAN KNOW OR WHY SHOULD THEY LIKE TO KNOW WHEN THEIR MANDATE IS TO RECOVER ONLY.

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