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What happens to the surety if principle debtor files for insolvency
01-Jul-2023 (In Banking / Finance Law)
If a person files an Insolvency Petition, what happens to the people who gave surety to the person while taking Debts? and, if a Muslim files an Insolvency Petition, is there any benefits?
Hi,
If a person files an insolvency petition, the persons gave surity was liable to pay the remaing debt with interest.
Surity means guarantee for the loan.
If you gave guarantee to a loan you are liable.
If the property attached for the loan banks go through auction to recovering the loans.( depends on the type of loan and type of property guaranteed to the bank) .
If the person Muslim also to follows the bank norms. ( guaranteed Muslim property was also liable for auction, if the property is clear title.)
Have a nice day , good luck.
If a person files an insolvency petition, the persons gave surity was liable to pay the remaing debt with interest.
Surity means guarantee for the loan.
If you gave guarantee to a loan you are liable.
If the property attached for the loan banks go through auction to recovering the loans.( depends on the type of loan and type of property guaranteed to the bank) .
If the person Muslim also to follows the bank norms. ( guaranteed Muslim property was also liable for auction, if the property is clear title.)
Have a nice day , good luck.
Helpful?
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Adv. Syam Charan Godi
Hyderabad | 100+ Answers
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Insolvency petition when a person not able to pay debt amount to the from whom taken it from or financials, that point of time the court will order to findg out is there any alternate way to pay off the debts from him like any properties if not that will be like bad debts for the person who gave the money, here the surety will also involves in repaying debt based on written agreement.
Helpful?
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Adv. Sharath Chandra Murthy
Hyderabad | 100+ Answers
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