Exclusive HOLI Discounts!
Get Courses and Combos at Upto 50% OFF!
Upgrad
LCI Learning

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Kutush   15 August 2018

Can bank liable gpa holder for default of loan?

Dear Experts,

 

My friend is a General Power of Attorney holder of a sole proprietorship firm. The owner of the firm had taken a loan from the bank by mortgaging property and other assets of the firm after which the POA came into existence. The loan account turned NPA over the years because of non-payment of interests. Now the bank has filed a case in Drt against the borrower and guarantors while simultaneously coaxing my friend to go for a compromise settlement. They are harassing her and threatening to file a suit against her in the court for non-payment of loan. My friend giving in offered a letter for one-time settlement to the bank and urged them to call the guarantors and make them sign with her in the offer letter since a part of mortgaged property belongs to them. It is to be noted that the POA holder is not a co-signee in the loan neither a joint account holder. Also, there is nothing written in the POA about the loan or her rights/duty to pay for the loan on behalf of the principle. But the bank refuses to call the guarantors. They are pressuring only her to repay the full amount.

 

Hence, I request you to advice me and clear some of my questions about the matter.

1) Is the POA holder competent enough to offer an one-time settlement proposal to the bank without the acknowledgment of the guarantors?

2) If the settlement goes through, what about the mortgaged property? Who will acquire the property?

3) Can bank liable the POA instead of guarantors for repayment of loan?

4) What are the possible measures or remedies that the POA can sought against the bank?



Learning

 0 Replies


Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register