Can loan guarantor sue the debtor for non payment

10-Aug-2023 (In Recovery Law)
Hi, I would like to know if a loan guarantor can sue the debtor if the debtor is unable to pay the loan. Also, the debtor has not signed any contract of repayment to the guarantor. In this case the guarantors put his property as a collateral and bank has put it up for auction. I would like to know if the guarantor can come after debtor and his property. Does the debtor face any jail time for not being able to pay the debt.
Answers (3)

Answer #1
922 votes
Yes, a guarantor to a loan can sue the principal debtor if he defaults and the guarantor had to pay on his behalf. In fact, as per section 145 of the Contract Act, there is an implied promise to indemnify the surety. Also, as per section 140 of the said Act, the surety/guarantor steps into the shoes of the creditor and has every right against the principal debtor/ borrower once he i.e. the guarantor has satisfied the creditor's debt.

Answer #2
841 votes
Yes you can intiate the recovery proceedings against the original debtor once you pay the loan amount to the bank and obtain all the original document related to loan. However debtor can not be given jail term as it is civil matter.
Answer #3
599 votes
It's depend on your transaction and agreement. Come with entire picture what u signed or not then only actual picture comes. But as per law their is only civil case again you for all no criminal case like arrest and all that taken against you. So contest it with your probable defense. U can contact me at my number.

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 and has been responded by one of the Divorce Lawyers at to address the specific facts and details.

Report abuse?

Comments by Users

No Comments! Be the first one to comment.

" has handpicked some of the best Legal Experts in the country to help you get practical Legal Advice & help."