Know when banks can seize property after loan default

When people borrow money from a bank to buy a house or a car, they promise to pay it back in small monthly payments called EMIs.

If someone loses their job or has money problems, they might miss a payment, which is called a default.

Missing just one payment does not mean the bank can suddenly take away your house or car.

For secured loans, the bank can only take the property after following legal steps, such as sending a written notice and giving the borrower 60 days to pay.

The law says banks must send this notice once the loan is classified as a non-performing asset.

Banks also hire recovery agents to collect money, but these agents cannot shout at, threaten, or embarrass borrowers.

Recovery agents cannot call before 8 in the morning or after 7 at night, and they cannot bother family members or friends.

If a borrower is treated badly, they should keep proof like call records or messages and complain to the bank.

If the bank does not help, they can complain to the Reserve Bank of India, or even go to the police if they feel threatened.

Banks can still get their money back, but they must always follow the rules and treat people fairly.