When looking for a debt settlement company, it’s important to consider the following factors:

– The company’s fees: Make sure you know how much the company will charge and what services they provide.

– The company’s reputation: Do your research and make sure you choose a reputable company with solid management team and a good track record.

– The company’s experience: Make sure the company has a lot of experience in debt settlement and knows how to negotiate with creditors.

– The company’s approach: Make sure the company has a plan that is right for you and your specific situation.

Loansettlement.com is led by experienced entrepreneurs who are alumni of IIT, IIM and MIT USA. They bring more than 30 years of entrepreneurial experience in varied domains – finance, consulting, online education and global careers management.

Our goal is to assist individuals in financial difficulties in getting out of debt. It’s widely acknowledged that if you default on your loan payments in India, recovery agents will pursue you and your life will become hellish, despite several Supreme Court rulings prohibiting the use of harsh measures during collection. We not only help you to negotiate settlement with the banks/ NBFCs but also put a stop to this kind of illegal harassment.

If you’re looking for a debt settlement company in India, please contact us today. We have significant expertise and we know how to get the best results for our clients.

For more information and to talk to our financial and legal advisors, register at loansettlement.com.

The post Debt Settlement Companies in India: How to Choose the Right One for You appeared first on Loan Settlement.

Here are some of the reasons why a person’s credit score is very important!

Credit score determines one’s creditworthiness

Credit score is used as a quick and highly reliable source by banks and financial institutions to judge an individual’s credit management record. A strong credit score would mean that the lender might be willing to approve a loan with favorable terms and conditions at lower rates of interest. A good score would give them a sense of assurance about the reliability of an individual. Simply put, a person’s credit score mirrors their payment habits.

Later the payment, lower the score

It has been found that a late payment of 30 days could drop the score up to 100 points. The same finding showed that a late payment of 90 days could damage the credit score for up to 7 years and deferring the payment for more than 120 days could “charge off” a person’s debt to a third party and this is further shown in the credit report. It also depends on the type of loan- in case of credit cards the damage may not be as much but if it is a monthly EMI, then the damage could last up to 2 years.

Law of credit score

Credit score and interest rates have an inverse relationship. Higher the credit score, higher the possibilities of the individual’s loans getting approved at lower interest rates. Lower credit score warrants a high interest rate with lower possibilities of the loan approval

A series of late payments is most inadvisable

One late payment, though inadvisable, can be compensated by diligent and prompt payment in the future. But that would not work if a person is a serial defaulter. A continuance of non-payment of loans can damage the credit report to an significant extent. It would be what one calls “digging your own grave”.

Credit score is a person’s reputation

The first thing banks do when a person applies for a loan is conduct background checks with credit information companies. They can know a person’s credit activities along with his/her reputation and reliability to pay back their dues. Hence a good credit score speaks volumes about one’s financial discipline.

Deferred payments and low creditworthiness are not just concerns for the customer but also the lender who relies highly on the credit score and report before approving any loan.

With all that said, here are some ways to maintain or improve your credit score:

• Pay your bills on time- every time. It has the greatest impact on your score. Set reminders or opt for online automatic payment so that you don’t miss the deadline.
• Do not get close to the credit limit. It is the limit that financial institutions extend to any debtor. Experts advise a person to keep the score at no more than 30% of total credit limit.
• A history of credit keeping and paying can go a long way in showing creditworthiness. It improves over time when a person has different accounts and pay what they owe on time.
• It is important to apply only for credit a person would need and nothing more.
• Lastly- make well informed and well planned decisions when it comes to your credit.

If your credit score is down, consider loan settlement. Register and talk to our counsellors for more information.

The post Credit Score – How It Makes Your Credit Soar Or Sore appeared first on Loan Settlement.

• This case took place in Ernakulam, Kerala. The petitioner, Mrs. Alphonsa Johny, had borrowed a car loan of Rs.4,65,000/- from the respondent, Mahindra & Mahindra Financial Services Ltd to help set up a business for her son.
• Due to set back in business, she had not paid Rs. 22,500/- of the monthly EMI and had offered to pay it the succeeding month.
• The respondents refused to accept this offer and initiated arbitrary proceedings against her in Chennai.
• Hereafter, the respondent along with its hired illegal recovery agents started harassing the petitioner and coerced her with threats of dire consequences and pressurized her. They seized a Hyundai car from the petitioner as well.

The petitioner filed a petition in the high court of Kerala seeking the following:

• To restrain the recovery agents and the respondent from using such agents from harassing the petitioner.
• To direct the respondent to provide police protection to the petitioner and restrain them from taking custody of the car.
• To set aside all proceedings related to the seizure of the vehicle and direct the respondent to accept the EMI’s.

Judgement:

The court held as follows:

• Unfair practices, such as using recovery agents or ‘goons’ are banned by RBI and thus the respondent and the recovery agents should stop harassing the petitioner.
• The residence of the petitioner is in Kerala and initiating arbitrary proceedings in another state (Chennai) is wholly without jurisdiction.
• The arbitrary proceedings are liable to be stayed and set aside.
• The respondent will also have to provide the petitioner with police protection so as to stop any form for harassment or coercion.

Learnings from the case:

Financial corporations are subjected to rules under the RBI and cannot use coercion or threats to get the customer to pay back loan. Any such act is liable to be questioned in law. A contract formed between two parties that have no consciousness of its terms is unenforceable. Moreover, the case also highlights the importance of place in the contract. If time and place for a contract is agreed upon, then it should be performed accordingly.

The post Case Study – Mrs. Alphonsa Johny v Mahindra & Mahindra Financial Services Ltd. appeared first on Loan Settlement.

-Complainant took a loan of ₹3,00,000 in May/June 2006

-The loan was issued by Kotak Bank on 26.06.06

-Period of Loan- 30 months due to be paid by Dec 2008.

-Mode of payment advanced cheques of ₹12,272.

-Complainant decided to prepay whole amount in March 2007 and deposited ₹2,32,526 along with prepayment charges.

-Amount was received by Kotak and they issued a receipt

-Complainant asked bank for the unused advanced cheques, bank denied stating company policy but complainant was given verbal assurance by the bank

-Later Complainant received a Legal Notice u/s 138 Negotiable Instruments Act

-Complainant visited the bank’s office and was reassured after checking their records that the loan was paid off as on March 2007 and their office instructed the counsel to withdraw the notice

-The complainant received a court summons in Sept 2008 stating the bank had filed complaint u/s 138 NIA

-Complainant visited the bank office again and was issued a letter stating full repayment of her loan had been done, and the case is being withdrawn

-When the case came up the bank did not withdraw the criminal complaint

-Before the second hearing the bank withdrew the complaint and the court allowed the same.

-Aggrieved by the unethical conduct and harassment, complainant filed the complaint for negligence and unfair trade practice praying an award of ₹15 lacs @18% interest p.a. as well as legal expenses and ₹15 lacs compensation for harassment, humiliation, torture and mental agony.

B. JUDGEMENT IN BRIEF

In this case, Kotak was held responsible for not terminating the loan account of the complainant and stopping the encashment of balance post-dated cheques after the closing of the account. This amounted to negligence in addition to unnecessary harassment of the complainant at the hands of Kotak Bank. Therefore, the court directed Kotak to pay a compensation of Rs. One Lakh including the cost of litigation to the complainant for the mental agony and trauma caused.

C. LEARNINGS FROM THE CASE  In matters of bank and financial transactions, it’s preferable to keep everything in writing. If your loan is closed, you should take the loan closure letter from the bank.

The post CASE STUDY -MS.JYOTI KHURANA v. KOTAK MAHINDRA BANK LTD. appeared first on Loan Settlement.