Parents gave a loan to someone but could not make loan agreement

Both my parents invested money with a builder who gave them monthly interest by cheque for many years.After my mother passed away the builder started defaulting in the monthly interest cheques. Its been 2 years now and even after asking for the capital back many times the builder keeps delaying repayment of capital.When l threatened legal action he promised to give me post dated cheques. Can I get him to sign a loan agreement with me now and if he signs it now is it legally valid? My parents gave the money to him as a loan in 2001 but didnt get a loan agreement signed by him.

Answers (4)

241 votes

Kindly take post dated cheques from him alongwith a settlement agreement mentioning about the loan given in 2001 also mention the cheque number and date in the said agreement. Those cheque should be for repayment towards the full and final settlement of your legal claim. Kindly make it on a stamp paper along with witness and notarize the same. For any further clarification and more detailed advice kindly book a consultancy call.

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321 votes

Dear Querist
An oral contract is also enforceable contract. If you inisist on signing of a loan agreement, than there is a possibility that developer may not agree. Since it is 2 years back that the developer started defaulting in repayment, your claim is within limitation period.
Evidences such as bank entries reflecting the disbursement of loan to him, interest being credited by developer etc will be required to establish your case.
To initiate legal proceedings send legal notice to Developer and thereafter you can initiate legal actions against him. You can go under civil action for recovering the money and for inflicting punishments on Developer under provisions of IPC you can initiate Criminal actions against Developer.

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318 votes

If u are able to get the loan agreement made in your name now with reference to the loan taken by him from your parents then that’s the best solution to recover money in future in case he defaults.
Otherwise we will have to see if there is the license of money lending and then proceed for criminal prosecution.

257 votes

As there are no agreement and documents to this loan the case is based on the borrower's acceptance of the fact. You should send a legal notice to them mentoning the facts of the matter demanding a refund of loan. His acquisance and or acceptance will bring the facts on record and admissible. If he is giving you PDC's in this regard take it writing note in regard to acceptance for repayment of loan he obtained from your parents.

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