NPA education loan

My brother in law has taken education loan in the year 2005. Unfortunately he is not alive. Now bank has freezed guarantor account and asking us to either make one time settlement or threatening us to made the recovery from guarantor account. My question is that : 1. Is it in bank authority to sieze guarantor account in education loan and made recovery from him? 2. Family financial condition is really bad and they are not in a position to repay the loan amount at once. 3. What should we do for the solution? 4. Where should be complain? Please advise.