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Notice received to guarantor for not paying loan amount by person
05-Apr-2023 (In Banking / Finance Law)
I’m personal loan guarantor to someone who has defaulted several emis. The person was my colleague but is now not working with me. I have his phone number but is not answering my calls. I’ve received a notice from an advocate asking to pay dues or bank will file lawsuit. The notice is on his office address but since he isn’t working here with me, obviously he won’t get the notice. What do I do now.
The borrower and you are equally liable to repay the loan amount in full. You have to find out the present whereabouts of the borrower and his address. Also you have press him to repay the loan installments. Otherwise bank will file a recovery suit before the court against the borrower and you.
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Adv. Lawrence D Cunha
Kochi | 25+ Answers
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By entering into a guarantee agreement you are promising the bank that you will pay the amount due to the bank in case of the default of the principal borrower. That means your liability is coextensive with that of the borrower. The bank is at liberty either to proceed against you or the borrower to realise its dues. This is the law. In your case, since there is a clear case of intentional cheating, you can file a criminal complaint for cheating as against the borrower. But your liability with the bank will still stand. You may find the person's address and aid the bank in recovering the amount from him.
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Adv. Murugan E.M.
Ernakulam | 25+ Answers
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