highlights
The bank gives the option of payment with penalty in case of EMI bounce for the first time.
In case of non-payment of EMI for the second time, the representative of the bank can come and contact you.
If you don’t pay 3 consecutive EMIs, the bank can recover your vehicle.
New Delhi. In present times, buying a car has become very easy for the common man. Banks finance up to 80 percent of the amount based on your credit score and income. Due to this facility, the number of car loan borrowers has also increased rapidly. But sometimes due to financial instability, you are not able to pay the EMI of the vehicle on time. In such a situation, recovery action is taken by the finance company.
If you do not pay the car loan EMIs, the recovery agent can pick up your vehicle. Here we are telling you under which circumstances recovery agents can take your vehicle. In such a situation, what rights do you have and how can you deal with such a situation.
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What does the bank do if the EMI is not paid
If you do not pay the EMI of the car loan, then in such a situation the bank adopts all the tricks to recover the money and in many cases also takes possession of your vehicle. If your EMI bounces once, the bank sends you reminder calls and gives you the option of paying with the penalty. On the other hand, if you do not pay EMI continuously for the second time, a letter comes to you from the bank to pay the EMI and also calls and representatives from the bank can come and contact you at your home. Also, the guarantors mentioned by you in the loan document can also be contacted.
By doing this, the bank will take possession of the vehicle.
If you do not pay three EMIs of car loan continuously and do not tell the reason to the bank, then the bank can take strict action against you. In such a situation, the bank counts your case in Non-Performing Asset (NPA). Simultaneously, the bank starts the process of car recovery. During this, bank recovery agents come to your home and after paperwork, recover the vehicle and take it with them. After vehicle recovery, the bank gives you one more month, in which time you have to pay EMI of four months, penalty and parking charges of the warehouse where the vehicle is parked.
Your rights in this situation
No bank recovery agent can forcefully take the vehicle from you even if the loan is not repaid. You can file a police complaint against this. The recovery agent cannot ill-treat you. Apart from this, the bank cannot give information about your financial condition to anyone other than the person in whose name the car loan is taken or who is the guarantor in the agreement. If you are unable to pay the EMI, then you can contact the bank and tell them about your financial condition. In this way, you can ask the bank for additional time to repay the EMI. However, it is at the discretion of the bank to give you time or not. If you get extra time then you may have to pay more interest and penalty for this.
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Tags: auto and personal loan, Bank Loan, business news in hindi, car loan
FIRST PUBLISHED : July 24, 2023, 17:18 IST