What Should You Do If You’re in Debt in India?

What should you do if you’re in debt in India?

Being in debt in India has now become more and more stressful, What should you do if you’re in debt in India

With high profile debtors and fraudsters like Nirav Modi, Vikram Kothari and our favourite Vijay Mallaya has made life for the ordinary debtor who is genuinely struggling with his/her finance more difficult and stressful. This is due to the fact that the Reserve Bank of India (RBI) has brought in new guidelines on all Banks and Non Banking Financial Company (NBFC) to crack down on debtors.

This means if you miss your EMI then the banks and finance companies will start ringing you to make the payment, but if you miss two EMI then the banks will start using debt collectors to chase you for the payments. We have cases where banks and debt collectors have ruthlessly chased debtors and also their family and friends so as to expose and embarrass the debtor to pay.

My advice to anyone in this situation would be to first of all face up to the amount of debt you’re in and make a plan to pay it off, even if that means getting professional help.

Debt can be a difficult subject to talk about and most Indians would bottle it in and not discuss it with their family and spouse.

It’s really important to find someone who can support you emotionally during this time.

If you want to speak to someone confidentially and for free, there are places you can go, and often the best first step is speaking up.

In the UK and USA there are many companies that the debtor can approach for help and support, they range from private companies like debt management companies to debt charities.

One only has to google debt management companies in the UK or USA and a large array of companies will appear. This service has been available in the UK and USA for 30 years and has efficiently helped millions of debtors become debt free and stress free.

These types of companies help the debtors to manage their debts by putting them under a debt management plan (DMP). These plans are bespoke to the debtors’ affordability in which the EMIs are reduced to one affordable monthly payment that the debtor can comfortably pay to all the creditors.

These debt management companies on behalf of the debtor will secure the reduced EMI with all the creditors and in some cases will also have the interest and charges frozen. This is usually agreed with the creditors when the debtor has been successfully servicing the DMP for 6 months with the debt management companies.

The governments of these countries have recognised the impact that debt has on the ordinary general public and the counties economy. In the UK, their government has introduced their own debt plan called Individual Voluntary Arrangement (IVA). This is a legally binding agreement between the debtor and their creditors. Under this agreement the debtor is protected from the creditors taking further actions against them and also a large percentage of the debtor’s debt will be written off about 75% to 80% !!!.

Where to get free debt & legal advice.

If you’re struggling with debt, it can be hard to know where to turn for help in India. There are not a lot of free advice services available across India, but now there are some debt management companies, similar to the UK & USA, appearing in India that can help you in a way that’s best for you. To find the nearest debt management company near you simply google debt management companies in India.

How will a debt & legal adviser help you?

A debt adviser will:

• never judge you or make you feel bad about your situation.
• always be happy to talk to you, however big or small your problem might be.
• find ways to manage your debts even if you think you have no spare money.
• suggest ways to deal with debts that you might not know about.
• help with your CIBIL score.

A legal adviser will:

• tell you your legal rights as a debtor
• stop all the harassments from the banks and debt collectors
• legally write to the banks and finance company to take reduced EMI
• protect you from any legal actions that the creditors take against you
• protect you from any bounced cheque legal action against you
• help to protect and increase your CIBIL score

How will a debt & legal adviser help you?

Most people who have got debt & legal advice tell us they feel less stressed or anxious and more in control of their life again.

Disclaimer

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. City Credit Management LLP is not liable for any decision arising out of the use of this information.