Failed to Pay Home Loan EMIs? Here’s What You Should Know
What happens if you miss three consecutive home loan EMIs? A notice and the bank starts this action
Home Loan Recovery Rule: When the customer does not pay two consecutive EMIs, the bank first sends a reminder. Even after this, the customer fails to pay the third EMI installment, then the bank again sends a legal notice to repay the loan.
Home loan has made it easy for the common man to buy a house. Especially in big cities, people buy flats easily by taking home loans. However, flat culture is now increasing rapidly in small towns as well. Especially employed people get home loans easily.
But many times the customers are not able to pay the EMI of the home on time. Especially in case of job loss or medical emergency, you miss paying EMI. Do you know what happens if you do not pay the home loan EMI? Till how much EMI does the bank wait and then what action is taken? Actually, home loan is kept in the category of secured loan, so instead the customer has to pledge any asset with the bank as a guarantee.
Bank in action for non-receipt of third consecutive installment
Now let us know, what are the guidelines of RBI on non-payment of home loan. If a customer does not pay the first installment of the home loan, then the bank or financial institution does not take him seriously. The bank feels that an EMI is getting delayed due to some reason. But when the customer does not pay two consecutive EMIs, the bank first sends a reminder. Even after this, the customer fails to pay the third EMI installment, then the bank again sends a legal notice to repay the loan.
In a way, with the non-payment of the third EMI, the bank gets into action mode. If the loan is not repaid after the legal notice, then the bank declares the customer a defaulter. Also, the bank considers the loan account as NPA. In case of other financial institutions, this limit is 120 days. After this time limit, the bank starts thinking about the recovery process.
RBI guidelines
The property is mortgaged in a secured loan, so that in case of non-payment of the loan, the bank can recover the loan by selling that property. However, this is the last option from the bank's side. According to the guidelines of RBI, the customer is given a lot of time to repay the loan. Legally the last option the bank has to get its money back is auction. The amount received from the auction is used to offset the loan amount.
Broadly, the bank gives two months more time to the customer after not paying the EMI for three months. If the customer defaults in this also, the bank sends an auction notice to the customer along with the estimated value of the property. If the customer does not pay the installment before the date of auction i.e. even after one month from the date of auction notice, the bank proceeds with the auction formalities.
risk of defaulter
However, within these 6 months, the customer can approach the bank at any time and settle the matter by paying the outstanding amount. The biggest disadvantage of not repaying the loan on time is that the bank declares the customer as a defaulter. Due to which the CIBIL / Credit score of the customer gets spoiled. Due to bad CIBIL score, there is difficulty in getting any kind of loan in future.
If such a situation comes with someone, that is, they fail to pay EMI, then there are some solutions for this too. The customer can approach the bank from where he has taken the home loan to discuss ways to restructure the home loan based on his financial preferences. The customer can tell his problem to the bank, as well as hand over the documents. Restructuring the loan can help in postponing the EMI by a few months or reducing the EMI amount. However, in such a case the tenure of the home loan will increase.
Apart from this, the simple solution is to try to repay the EMI of the home loan on time as much as possible. If there is a fixed deposit for this, break it. If there is any investment, withdraw it and fill the EMI. For this, you can also borrow from family or friends and return it later as per your convenience.
What to do if the recovery agent threatens?
Due to not being able to repay the loan, pressure is created on the customer by sending the recovery agent on behalf of the financial institutions. He is also threatened. Many cases of arbitrariness of recovery agents keep coming to the fore across the country. If you are also harassed by the recovery agent for repaying the home loan, then you can directly complain to the police. Since non-payment of loan installment comes under the ambit of civil dispute, hence no arbitrary action can be taken against the defaulter. Apart from this, you can also give a written complaint to RBI.
If a borrower misses three consecutive home loan Equated Monthly Installments (EMIs), it can lead to several consequences, including:
Notice from the Lender: The lender, typically a bank or financial institution, will likely send a notice to the borrower informing them of the missed payments and the outstanding amount due. The notice will serve as a reminder and a warning of potential consequences if the payments are not made promptly.
Late Payment Fees and Penalties: The lender may impose late payment fees and penalties for the missed EMIs. These additional charges can increase the overall amount owed and affect the borrower's financial situation.
Negative Impact on Credit Score: Non-payment or delayed payments on a home loan can negatively impact the borrower's credit score. A lower credit score can make it more challenging to secure credit in the future and may lead to higher interest rates on loans.
Legal Action: If the borrower continues to default on the loan after receiving the notice, the lender may initiate legal proceedings. This typically involves filing a lawsuit to recover the outstanding loan amount and potentially seeking repossession of the property through foreclosure or other means.
Foreclosure or Repossession: In severe cases, if the borrower fails to rectify the default or make arrangements to repay the outstanding amount, the lender may initiate foreclosure proceedings. Foreclosure allows the lender to recover the outstanding loan amount by selling the property to repay the debt.
It's essential for borrowers facing financial difficulties to communicate with their lender as soon as possible to explore options for loan restructuring, payment rescheduling, or other alternatives to foreclosure. Each situation may vary, and it's advisable to consult with a financial advisor or legal professional for guidance based on the specific circumstances.
- Home loan interest rates in India
- Best home loan providers in India
- Home loan eligibility criteria
- Home loan documents required
- Home loan EMI calculator India
- Home loan process in India
- Home loan for self-employed in India
- Home loan for salaried individuals in India
- Home loan foreclosure charges in India
- Home loan prepayment calculator India
- Home loan balance transfer offers
- Home loan interest rate comparison India
- Home loan tax benefits in India
- Home loan repayment options in India
- Home loan subsidy schemes in India
- Home loan for NRI in India
- Home loan for under-construction property in India
- Home loan for resale property in India
- Home loan for plot purchase in India
- Home loan for renovation in India
- Affordable housing home loan schemes in India
- Home loan for rural areas in India
- Low-interest home loan options in India
- Home loan for women in India
- Home loan without income proof in India
- Home loan for low-income groups in India
- Home loan for government employees in India
- Home loan for pensioners in India
- Home loan with zero down payment in India
- Home loan for first-time buyers in India
- Home loan for second home in India
- Home loan for construction in India
- Home loan for extension in India
- Home loan for flat purchase in India
- Home loan for villa purchase in India
- Home loan for apartment purchase in India
- Home loan for gated community in India
- Home loan for high-rise building in India
- Home loan for low-rise building in India
- Home loan for affordable housing projects in India
- Home loan for luxury homes in India
- Home loan for urban areas in India
- Home loan for semi-urban areas in India
- Home loan for rural development in India
- Home loan for smart cities in India
- Home loan for green homes in India
- Home loan for energy-efficient homes in India
- Home loan for earthquake-resistant homes in India
- Home loan for sustainable housing in India
- Home loan for eco-friendly homes in India
- Home loan for vaastu-compliant homes in India
- Home loan for vastu-compliant flats in India
- Home loan for gated communities in India
- Home loan for high-value properties in India
- Home loan for joint owners in India
- Home loan for partnership firms in India
- Home loan for LLP in India
- Home loan for builders in India
- Home loan for developers in India
- Home loan for real estate projects in India
- Home loan for commercial property in India
- Home loan for industrial property in India
- Home loan for office space in India
- Home loan for retail space in India
- Home loan for warehouse in India
- Home loan for factory in India
- Home loan for shop in India
- Home loan for showroom in India
- Home loan for restaurant in India
- Home loan for hotel in India
- Home loan for hospital in India
- Home loan for school in India
- Home loan for college in India
- Home loan for hostel in India
- Home loan for hostel building in India
- Home loan for land purchase in India
- Home loan for agricultural land in India
- Home loan for non-agricultural land in India
- Home loan for farmhouses in India
- Home loan for vacation homes in India
- Home loan for beachfront property in India
- Home loan for hill station property in India
- Home loan for city center property in India
- Home loan for suburban property in India
- Home loan for satellite towns in India
- Home loan for upcoming areas in India
- Home loan for metro cities in India
- Home loan for tier 1 cities in India
- Home loan for tier 2 cities in India
- Home loan for tier 3 cities in India
- Home loan for gated communities in Bangalore
- Home loan for luxury homes in Mumbai
- Home loan for affordable housing in Delhi
- Home loan for under-construction property in Chennai
- Home loan for resale property in Kolkata
- Home loan for plot purchase in Pune
- Home loan for renovation in Hyderabad
- Home loan for NRI in Gurgaon
- Home loan for self-employed in Noida
- Home loan for salaried individuals in Ahmedabad
- Home loan interest rate comparison Bangalore
- Home loan EMI calculator Mumbai
- Home loan eligibility Chennai
- Home loan documents required Delhi
- Home loan foreclosure charges Kolkata
- Home loan prepayment calculator Pune
- Home loan balance transfer offers Hyderabad
- Home loan tax benefits Gurgaon
- Home loan repayment options Noida
- Home loan subsidy schemes Ahmedabad
- Home loan for first-time buyers in Bangalore
- Home loan for second home in Mumbai
- Home loan for construction in Chennai
- Home loan for extension in Delhi
- Home loan for flat purchase in Kolkata
- Home loan for villa purchase in Pune
- Home loan for apartment purchase in Hyderabad
- Home loan for women in Gurgaon
- Home loan without income proof in Noida
- Home loan for low-income groups in Ahmedabad
- Home loan for government employees in Bangalore
- Home loan for pensioners in Mumbai
- Home loan with zero down payment in Chennai
- Home loan for urban areas in Delhi
- Home loan for semi-urban areas in Kolkata
- Home loan for rural development in Pune
- Home loan for smart cities in Hyderabad
- Home loan for green homes in Gurgaon
- Home loan for energy-efficient homes in Noida
- Home loan for earthquake-resistant homes in Ahmedabad
- Home loan for sustainable housing in Bangalore
- Home loan for eco-friendly homes in Mumbai
- Home loan for vaastu-compliant homes in Chennai
- Home loan for vastu-compliant flats in Delhi
- Home loan for gated communities in Kolkata
- Home loan for high-value properties in Pune
- Home loan for joint owners in Hyderabad
- Home loan for partnership firms in Gurgaon
- Home loan for LLP in Noida
- Home loan for builders in Ahmedabad
- Home loan for developers in Bangalore
- Home loan for real estate projects in Mumbai
- Home loan for commercial property in Chennai
- Home loan for industrial property in Delhi
- Home loan for office space in Kolkata
- Home loan for retail space in Pune
- Home loan for warehouse in Hyderabad
- Home loan for factory in Gurgaon
- Home loan for shop in Noida
- Home loan for showroom in Ahmedabad
- Home loan for restaurant in Bangalore
- Home loan for hotel in Mumbai
- Home loan for hospital in Chennai
- Home loan for school in Delhi
- Home loan for college in Kolkata
- Home loan for hostel in Pune
- Home loan for hostel building in Hyderabad
- Home loan for land purchase in Gurgaon
- Home loan for agricultural land in Noida
- Home loan for non-agricultural land in Ahmedabad
- Home loan for farmhouses in Bangalore
- Home loan for vacation homes in Mumbai
- Home loan for beachfront property in Chennai
- Home loan for hill station property in Delhi
- Home loan for city center property in Kolkata
- Home loan for suburban property in Pune
- Home loan for satellite towns in Hyderabad
- Home loan for upcoming areas in Gurgaon
- Home loan for metro cities in Noida
- Home loan for tier 1 cities in Ahmedabad
- Home loan for tier 2 cities in Bangalore
- Home loan for tier 3 cities in Mumbai
- Home loan for gated communities in Chennai
- Home loan for luxury homes in Delhi
- Home loan for affordable housing in Kolkata
- Home loan for under-construction property in Pune
- Home loan for resale property in Hyderabad
- Home loan for plot purchase in Gurgaon
- Home loan for renovation in Noida
- Home loan for NRI in Ahmedabad
- Home loan for self-employed in Bangalore
- Home loan for salaried individuals in Mumbai
- Home loan interest rate comparison Chennai
- Home loan EMI calculator Delhi
- Home loan eligibility Kolkata
- Home loan documents required Pune
- Home loan foreclosure charges Hyderabad
- Home loan prepayment calculator Gurgaon
- Home loan balance transfer offers Noida
- Home loan tax benefits Ahmedabad
- Home loan repayment options Bangalore
- Home loan subsidy schemes Mumbai
- Home loan for first-time buyers in Chennai
- Home loan for second home in Delhi
- Home loan for construction in Kolkata
- Home loan for extension in Pune
- Home loan for flat purchase in Hyderabad
- Home loan for villa purchase in Gurgaon
- Home loan for apartment purchase in Noida
- Home loan for women in Ahmedabad
Liver Detox - Liver Purification - Liver Fat-Burning
Liver Detox - Liver Purification - Liver Fat-Burning
https://www.liver-detox.org/
Special Offers - Limited Offers
Special Offers - Limited Offers
https://www.limited-offer.org/
Amazon Best Sellers - Amazon Today's Deals - Amazon Offers
Amazon Best Sellers - Amazon Today's Deals - Amazon Offers
https://www.amazon-associate.online/
American Tourister Luggage - American Tourister Backpacks - American Tourister Hard Luggage
American Tourister Luggage - American Tourister Backpacks - American Tourister Hard Luggage
https://www.americantourister.online/
Craigslist - Craigslist Jobs - Craigslist Business - Craigslist Services
Craigslist - Craigslist Jobs - Craigslist Business - Craigslist Services
https://www.giglist.biz/
Breaking News - Current Affairs - Business News - Technology News - Entertainment News - Sports News - Science News - Health News
https://www.anytimenews.org/
Tourism Videos - Travel Videos - News Videos
Tourism Videos - Travel Videos - News Videos
https://www.youtube.com/@TourismTimes
Breaking News Videos - Current Affairs Videos - Business News Videos - Technology News Videos - Entertainment News Videos - Sports News Videos - Science News Videos - Health News Videos
https://www.youtube.com/@AnyTimeNevs
MrBeast - MrBeast Latest - MrBeast YouTuber - MrBeast YouTube Channel
MrBeast - MrBeast Latest - MrBeast YouTuber - MrBeast YouTube Channel
https://www.youtube.com/@MisterBeastMisterBillionaire