Baljit Singh (Electrical Engineer) 20 March 2011

Cosigned loan and borrower died, PLease help ASAP

Hi Everyone,

I am a NRI from USA and found this website when I was surfing web for solutions. My Dad cosigned our neighbor to start a business, the neighbor took loan from PFC (Punjab Financial Corporation, Chandigarh, Punjab) in the amount of 9 Lakh in 1990. He purchased land and machinery from that 9 Lakh. After 2 years my Dad decided not to pursue the business and instead asked PFC (Punjab Financial Corporation, Chandigarh, Punjab) Lender) to remove his name from the guarantor because the borrower is not acting in good faith. The Lender replied back stating that my dad stays as guarantor until a replace guarantor is produced. The borrower had been defaulting loan for a long time and even his business has been sealed more than once. In the year 2007 the borrower requested additional loan of 2 Lakh. T bank replied back stating that the previous guarantor(My Dad) has refused to continue the guarantee, if you (borrower) want additional loan then he would need to provide fresh guarantor for previous balance and the new loan amount. My dad found out that the bank gave him(borrower) additional funds as requested. Just recently we found out that the borrower died of illness in Dec of 2010. Few days back (March 2011) my dad received summons from court to appear in court in April 2011. My dad was not home at the time of delivery and she refused to accept the court summons on his behalf. My dad have two businesses and one house, only one business is under my Dads name and rest in under my Moms name. My dad just transferred one business property under my and my brother’s name (only two son’s). The other business and House is under my Mom’s name. She owns the business and pays Income tax regularly. Here are a few questions if anyone can answer.

Can PFC (Punjab Financial Corporation, Chandigarh, Punjab) Lender) come after the property which is under my Mom or his Son’s name?
Can my Mom gift these properties to her grandkids even when my Dad may be liable for borrower loan after his death?
As per Banks statement, Isn’t my Dad already relieved from Guarantor since they gave the borrower additional funds.

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3 Replies

DEFENSE ADVOCATE.-firmaction@g (POWER OF DEFENSE IS IMMENSE ) 20 March 2011

Your father only is liable but can take the defense that terms are changed without his consent. If the report on summons is refused that court order will be exparte and hence find out appear and defend.

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DEFENSE ADVOCATE.-firmaction@g (POWER OF DEFENSE IS IMMENSE ) 20 March 2011

Your father only is liable but can take the defense that terms of laon are changed without his consent.

If the report on court summons is refused than court order will be exparte against your father and hence find out appear and defend in the court.

IN THE EVENT OF EXPARTE ORDER / DECREE THERE WILL BE FEW CHANCES TO DEFEND SO TAKE CARE

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Baljit Singh (Electrical Engineer) 21 March 2011

I really appreciate your prompt response. I am not aware of the legal terms but please correct me If I interpret your response correctly. I think you mean:

1. I should tell my Dad to get the summons from court personally quickly without further delay since it may held against him and can harm more than any benefit.

2. Any property under my Mom's name alone is safe and we should not be worried about loosing it to the lender just because my Dad cosigned as Guarantor.

Is it possible for you to recommend a good lawyer in Chandigarh or Mohali. Please reply soon.

Thanks in advance,

Baljit Singh.