Krishna needs to purchase a new house. She has applied for a loan of rupees 10 lacs from a Government bank. Explain on which terms the bank should credit her the loan?
Answers
Many of us have taken loans to finance some of life’s major events: buying the family car, becoming homeowners, marrying off a family member, or paying for a medical emergency. Taking a loan helps us circumvent our lack of large sums of liquid cash. And, we pay back the loan with interest, in EMIs. Sometimes, because of circumstances beyond our control, we are unable to repay our loans in a timely manner. Inability to repay a loan for a prolonged period leads to the deterioration of the relationship between the borrower and the lender. This is usually a bank or a Non-banking Financial Company (NBFC). Such a situation needs active management. You must understand what consequences loan defaults will have.
Money owed should be repaid eventually, but let’s take a look at your rights as a loan defaulter, and how you can set the situation right.