Repayment of loan to informal money lenders
25-Apr-2023 (In Civil Law)
Parents of a friend of mine had taken money from a few (apparently non-licensed) money lenders some years back, in order to meet impending medical expenses. I learnt from my friend (who is a 28 year old woman) that the lenders have been charging interests at arbitrary rates, sometimes at as high as 15%. This has increased the total payable amount to around 5 lakhs, and consequently, has led to an immense financial burden on the family. As of today, they have completely exhausted ALL their savings. My friend lives away from her parents, and, is a researcher in physics with a monthly income of 35K. Her father is a pensioner earning around 16K. They are paying 15-20K each month in an effort to repay the debt. She has managed to know that the money lenders number 10-11 and almost all of them are non-licensed. Can you please suggest a possible course of action?
Since they are non-licensed money lenders, ask your friend not to repay the money anymore. However, there are certain legal consequences. They can institute cases against your friend/her family for recovery of money but however you can defend those cases. Please contact for more details.
Dear client,
It's very good to see that you are sensitive towards your friends problem or it may be so that it's your personal problem anyways coming to the legal issue if the rates of interest were exhoribtant then your friend should not have taken the loan from them but as they do not possess any money lending licence they cannot charge interest and cannot claim interest on the principal but they can obviously claim the principal amounts if they have legal documents to that effect but as you have already paid sufficient amount that should be adjusted with the main amount.
It's very good to see that you are sensitive towards your friends problem or it may be so that it's your personal problem anyways coming to the legal issue if the rates of interest were exhoribtant then your friend should not have taken the loan from them but as they do not possess any money lending licence they cannot charge interest and cannot claim interest on the principal but they can obviously claim the principal amounts if they have legal documents to that effect but as you have already paid sufficient amount that should be adjusted with the main amount.
First of all I need to be briefed regarding loan documents executed by parents of your friend and the details of money lenders then only I would be able to provide proper legal course of action to be taken.
MY OPINION THAT the matter which i have through that is should be in various legal formats, the money lenders are non licensed as well as they have used the interest in arbitrary rates which are completely illegal,so as far present situations,you should move immediately in various ways in legal field.
Your friend and his family ,as stated by you, are now under the claws of unscrupulous people.It is important to know whether they have signed on hand note (promissory note/demand note) and mortgaged their property as collateral security.
If legal relief is needed , contact lawRato for further course of action.
If legal relief is needed , contact lawRato for further course of action.
Disclaimer: The above query and its response is NOT a legal opinion in any way whatsoever as this is based on the information shared by the person posting the query at lawrato.com and has been responded by one of the Divorce Lawyers at lawrato.com to address the specific facts and details.
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