Your Queries – Loans: Bank can take away assets of guarantor if loan not repaid on time

May 25, 2021 3:45 AM

First, you should ask the two known parties to find another guarantor to their loan. When a person stands in as a guarantor, he gets paperwork to record the details.

The changes would be automatic when repo rate changes.The changes would be automatic when repo rate changes.

By Chaitali Dutta

My husband died due to Covid. He was loan guarantor for his cousin’s hospital building loan and for his brother-in-law’s personal loan. How do I find out what other loans was he guarantor for? What are his liabilities that would take away assets we may inherit?
—Bhargavi Joshi
First, you should ask the two known parties to find another guarantor to their loan. When a person stands in as a guarantor, he gets paperwork to record the details. Such paperwork should be in the documents. In case any of these two loans becomes overdue for payment now, the bank may acquire your late husband’s assets to repay the loan. If both loans are regular with no amount overdue, there is no liability currently. Financially it does bring in uncertainties for you till the guarantor names are replaced.

I had applied for an education loan to study MBA in Australia. Since our college studies are happening online and have to pay only a part of the fees, can I defer the education loan?
—Ravi Amol
It will depend on the clauses mentioned in the sanction letter of the education loan. You may decide to avail of part of the loan amount and convey the same to the bank. However, if you do not draw any amount from the loan account, the bank may cancel the sanction. I suggest you avail a small amount of the loan to keep the arrangement alive.

If I migrate my home loan from Marginal Cost of Funds Based Lending Rate (MCLR) to Repo-linked Lending Rate (RLLR), can I re-migrate to the original type of MCLR?
—Kanakeswar Das
After the RBI circular on RLLR, all loan accounts are linked to Repo rate. No new loan account will be sanctioned pegged to MCLR. Migration back to MCLR linked account will not be possible.

Why do I have to pay to lower my interest rate on my home loan?
—Satish Rajwansh
I presume your current loan account is linked to MCLR. Therefore the need to pay every time to reduce interest rate. Ask the bank to change your loan to RLLR where the interest rate is linked to Repo rate. The changes would be automatic when repo rate changes.

The writer is founder, AZUKE Personal Finance Advisory (www.azukefinance.com). Send your queries to fepersonalfinance@expressindia.com

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