Loan Recovery – bharatdhanpayi.com

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Loan Recovery - Legal & Professional Loan Recovery. Ethical Recovery, Lasting Solutions.

Loan Recovery means the process by which a bank, NBFC, private financer, or any lending institution recovers the money lent to a borrower (with interest and charges) if the borrower fails to repay on time.

Loan Recovery Process in India

Reminder & Follow-Up
- Phone calls, SMS, and emails are sent for EMI reminders.
- Recovery agents may visit borrower’s home/office.
Penalties & Late Fees
- Overdue interest and late payment charges are added.
Restructuring / Settlement
- Lender may allow rescheduling EMIs.
- One-time settlement (OTS) at a negotiated amount.
Legal Recovery (if borrower defaults)
- SARFAESI Act, 2002 – For secured loans like home loans or business loans. Bank can seize & auction borrower’s property without court approval.
- DRT (Debt Recovery Tribunal) – For loans above ₹20 lakh.
- Civil Suit / Arbitration – For unsecured loans or smaller cases.
Use of Recovery Agents
- Banks/NBFCs use authorized recovery agencies.
- Agents must follow RBI guidelines (no harassment, abusive language, or threats).
Credit Bureau Reporting
- Default reported to CIBIL, Experian, CRIF, Equifax.
- Negatively affects borrower’s credit score & future loan eligibility.

Rights of the Lender

• Recover dues through legal means.
• Charge penalty & interest.
• Auction secured assets (if applicable).

Rights of the Borrower

• Receive proper notice before recovery/auction.
• Option to settle or restructure loan.
• Protection against harassment (RBI & Supreme Court guidelines).

Loan Recovery Strategies (For Lenders & Finance Companies)

• Early warning system – Track EMI delays.
• Soft recovery – Reminders, counseling, restructuring.
• Hard recovery – Legal notice, DRT, SARFAESI action.
• Third-party recovery agencies – On commission basis.
• Digital recovery – Automated calls, payment links, settlement offers.