Procedure for recovery of education loan dues
p santosh kumar
(Querist) 09 September 2012
This query is : Resolved
I have availed education loan amount is rs 3.50 lacsin june 2008 and course completed on oct 2010and i got job on march 2012.the repayment holiday is for course period + one year from the date of completion of studies or six months from the date of getting employment, whichever is earlier.therfore due is from oct 2011,,till due is EMI rs 10500*11 months,from march till now i paid 50000.
Now i have eceived notice to pay within 15 days Rs 6.50 lacs,, i wonder how it can be 6.50 lacs when my due is for 11 months and out out of that 50000 i paid.
How to reply to bank official,, whether tht notice is valid notice and shall i bind to tht notice and whether it is null and void notice.
Raj Kumar Makkad
(Expert) 09 September 2012
You should personally visit in the bank and should personally enquire about your account. It seems that same shall been declared as NPA and thus penal interest and all other charges have been added thereto apart from regular interest etc. You should move an application to the effect that in future your account shall be regular and thus it be regularised.
prabhakar singh
(Expert) 09 September 2012
Yes!When loan EMI is not paid regularly after
few consecutive defaults bank declares the loan a/c as NPA and then whole the sum to gather compound interest chargeable at quarterly rest is the norm on which they proceed to act.Hence better first inquire the status of your a/c from bank and then persuade them with assurance of no default.
malipeddi jaggarao
(Expert) 10 September 2012
This is the biggest problem in education loans. Students/parents do not keep track of repayment schedule. Banks also do not bother to send regular communications to them reminding the repayment.
In your case, the default is more than 90 days and as per the norms the account would slip into NPA. Once the account is slipped into NPA, the Banks wake up and initiation action for recovery. The first step the banks do is recalling the entire outstanding. That what has happened in your account.
This is September. Banks are supposed to be vigorous in recovering the dues and not allowing the accounts to slip into NPA.
The suggestion is go and meet personally the Branch Manager. Explain him they can not recall the entire advance with a single notice without sending the reminders on due date (if they have not sent). Also impress upon him that the default is not willful. If you are prepared to pay the dues till date as per previous EMI calculations, I feel it will be accepted without any difficult and you need not have to pay the entire dues. Even if you do not have sufficient funds to clear the overdues as suggested above, you can keep 2/3 EMIs in abeyance for the present with a promise to clear this amount in the next month.
There is not use of sending a reply without any discussion with the Branch Head. Even you send the reply they do not give value for it go ahead of their actions. Though the actions are wrong, chances of challenging them are bleak and if somebody is ready, many of them are so thick skinned and they are ready to face the consequences with a view that by the time challenge poses the real problem, either they will be retired or they will be shifted the particular position. Hence go personally and meet the Branch Head. If he does not listen, you can see the next higher authority.
Do not be panicky if you can pay the overdue amount. You need not pay the entire amount in one lot as suggested in the notice. Many a time, these notices are threats leashed out by the sleeping banks who do not bother to establish communication with their clients.
p santosh kumar
(Querist) 11 September 2012
Thanx to all,
I will pay more than the EMIs due now,
Notice issued is wrong amount stated as on sept 11 is 6.50 lacs as per notice but as per bank statement it is only 5.5 lacs.
But a notice is also issued to father whether it is permissible? loan amt less thn 5 lacs no guarantor is required as per RBI guidelines,, tht notice is null and void?
Can i respond by another notice stating tht earlier notice is wrong.
I want to know what is the procedure for NPA loan,, what is the procedure for recovery,suppose it is fallen to doubtful asset what is the procedure.
malipeddi jaggarao
(Expert) 11 September 2012
You can find out the exact amount by contacting the bank's branch personally.
Though there is no guarantee required to the loans upto Rs.5 lakh for education loan, your father might have been included as co-obligant. This is as per the guidelines on education loan scheme.
You need not respond by another notice initially. First you go and settle the matter with the Branch Manager. You will definitely get the required remedy.
The last question is of academic interest hence need not be replied at this stage.
