Guarantor's liability
Ashutosh Gupta
(Querist) 23 December 2017
This query is : Resolved
Dear Sirs,
I have given guaranty in my brothers home, which has been now defaulted in repayments to the tune of Rs. 2800000/-. Bank has given notice of 60 days for dues clearance. kindly inform what is the liability for guarantor in this case. will it also effect my CIBIL ratings.
Guest
(Expert) 23 December 2017
As a guarantor, you are fully liable to get the loan cleared. CIBIL record also gets affected with the default in payments of EMIs.
Kumar Doab
(Expert) 23 December 2017
Go thru the copy of Loan agreement that was signed.
The liability is usually severely and jointly.......
Per notice to you i.e. guarantor if payment is not made the lender may send intimation to credit bureau's like CIBIL.....
Kumar Doab
(Expert) 23 December 2017
The LCI experts Mr. Rajendra K Goyal, Mr. Mallipedi Jaggarao are from legal cells of banks/banking background and if you wish you may get in touch with them..............
Sudhir Kumar, Advocate
(Expert) 24 December 2017
You hve to ensure that your brother pays the loan and if he does not then youpay the loan with interest which is adding day by day.
If you pay the loan you have a right to sue to title of the house or recover the money from your brother by civil suit.
Isaac Gabriel
(Expert) 24 December 2017
Legally, the borrower as well as the surety equally liable for the debt and action could be initiated against both at the same time.
Ms.Usha Kapoor
(Expert) 29 December 2017
Central Government Act
Section 128 in The Indian Contract Act, 1872
128. Surety’s liability.—The liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract. —The liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract." Illustration A guarantees to B the payment of a bill of exchange by C, the acceptor. The bill is dishonoured by C. A is liable, not only for the amount of the bill, but also for any interest and charges which may have become due on it. A guarantees to B the payment of a bill of exchange by C, the acceptor. The bill is dishonoured by C. A is liable, not only for the amount of the bill, but also for any interest and charges which may have become due on it."
ACCORDING TO THE ABOVE THE LIABILITY OF GUARANTOR IS COEXTENSIVE WITH THE PRINCIPAL DEBTOR ON HIS DEFAULT GUARANTOR OR SURETY SHOULD DISCHARGE THE LOAN OF CREDITOR OR BANK ALONG WITH INTEREST AND DAMAGES ETC.. ONCE THE BANK'S LOAN IS DISCHARGED BY SURETY HE WILL STAND IN THE SHOES OF CREDITOR TO PRINCIPAL DEBTOR AND CHASE THE PRINCIPAL DEBTOR TO PAY OFF THE LOAN+ INTEREST AND OTHER CHARGES.Cibil record or ratting also would fall.
Ms.Usha Kapoor
(Expert) 29 December 2017
iF YOU APPRECIATE MY ANSWER PLEASE CLICK LIKES.
