RBI gives 5 rights to those who cannot repay their loan, it will be useful in difficult times

HR Mandi Bhav News:- The Income Tax Department is taking strict action against loan defaulters. However, if a common man is unable to pay the EMI of his home or personal loan, then the bank or the loan giving company cannot harass him. 

There are many rules behind this which control their actions. You have many rights under the law which it is important for you to know-

Right to notice-

Defaulting does not take away your rights, nor does it make you a criminal. When you are unable to repay the loan, banks have to follow a prescribed procedure. First, they give you time to repay the loan. If you do not repay, action is taken by the banks under the Sarfaesi Act.

If your loan is declared a non-performing asset (NPA), you will be given a 60-day notice. After this, the bank will also have to give a 30-day public notice for the sale of the property, which will include complete details of the sale. During this process, there is a provision for you to get adequate rights and time.

Right to ensure fair price-

If you do not pay your dues or respond during the 60-day notice period, the lender can start auctioning your property. Before the auction, the lender will have to send you a notice, which will include information such as the property value as determined by the bank's valuers, the reserve price, the auction date and time. 

If the property value is undervalued, you can register your objection. Also, you can search for potential buyers for a better price and introduce them to the lender, which may improve your situation.

Getting the remaining amount-

After your property is taken over by a bank or a loan company, do not think that it is completely out of your hands. Keep an eye on the auction process. 

These days it has become easy, most banks or loan companies conduct e-auction. After recovering its dues, the bank has to refund any remaining amount.

Right to be heard-

During the notice period, you can present your case to the authorized officer and inform him about your objections to the notice of possession of the property. The officer has to respond to it within seven days. If he rejects your objection, he will have to give valid reasons for it.

Right to humane treatment-

RBI (Reserve Bank of India) has control over the banks, so that they cannot recover the dues like moneylenders. Due to incidents of debt recovery agents harassing customers, RBI had given a strict warning to the banks. 

As a result, banks decided to follow best practices keeping in mind their commitment towards the customers. 

Agents for debt recovery can contact only at places designated by the bank; if there is no such place, they can only visit the property owner's home or workplace. 

Agents are required to take care of the customer's privacy and their activities should be limited between seven in the morning and seven in the evening.