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Anish Menon (Sr.Manager)     08 December 2010

Guarantor to a loan


I need your help to understand the criticality of  following situation.

I am a guarantor for one of my old collegue's personal loan. He had taken 3 lakh. He repaid the loan for one year around 1 lakh. After that he did n't paid. I was not aware of this. Last time when I went to bank, manager told me that  this issue has already been referred to their legal department. They tried their best to locate the person who has taken the loan. But failed in that. They asked me to locate the person and told me that if he is not paying I have to pay. He did n't pay for the last two years.

I tried to reach this person. But could n't locate. I got a mail from him mentioning that, he is not in a position to repay.

Can anybody suggest what action I need to take..





 7 Replies

N.K.Assumi (Advocate)     08 December 2010

You are equally liable for it.

Anish Menon (Sr.Manager)     08 December 2010

Is there a way to reduce my burden. I heard about some settlement option. Do I need to pay his full loan amount? No other options

N.K.Assumi (Advocate)     08 December 2010

Ofcourse there is. Approach the Branch Manager, he will surely guide you.

Anish Menon (Sr.Manager)     08 December 2010

hm......Thank you very much for all the feedback......what to do result of trusting close collegues

SRISHAILA.DHARANI (Advocate&consultant)     08 December 2010

Dear Anish,

Do Onwe thing, give a compalint to the nearest police station, narrating these facts and they will take action.If they didnt action.give a compalint to the police commissioner of your area.I think thids will help you in solving the problem.

But strictly speaking in a legal manner, you are liable to pay the amount, in the absence of barrower.You can also do one thing, go for one time settllement [ OTS SCHEME].In that scheme they will wave of the interest part and they will only ask you the priciple amount.In that case, you have to pay initially 25% of the loan amount and the balance you can pay within a year.






DEFENSE ADVOCATE.-firmaction@g (POWER OF DEFENSE IS IMMENSE )     08 December 2010

No police complaint buisness , it is not applicable  in this matter.

You get the person and go to the higher ups of the bank and get advantage of there one time settlement schemes. Mostly interest is waived if you pay the principal amount0


Raanjkumar (Prop)     14 December 2010

Standing Guarantee is as good as taking a loan. You are liable to pay the Bank. If you are financially strong, then I dont think the Bank will want to settle the amount. They will want principal along with interest. You have committed a mistake by standing guarantee.. you will have to pay for it ( sounds mean but this is the fact of life).

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