my father (late) & mother (61 yrs) stood as guarantors for a loan of 14 lakhs taken by a friend from a co-op bank in 1997. He is not able to repay the loan, he has paid off the principal amout & a substantial part of the interest. He is currently bankrupt & without any assests. Bank claims that our flat has been mortgaged against this loan. Bank claims they possess all necessary documents. We possess the original flat agreement and society membership share certificates. We are aware that the bank possesses the society noc. We are not sure what other documents they possess.
What should we do in this situation ? Can we file a case & win on the basis of original flat agreement. Also my mother being a widow & a senior citizen. Please suggest how do we get ourselves out of this situation. Or what can our friend do?
Please note that our friend has been working & paying his salary against the loan amount. Although we do not have confirmation. But the bank says that his funds are very insufficient. Current outstanding is 54 lakhs. So they will attach our flat for auction.
