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HIt’s incredibly disheartening to hear that HDFC bank’s credit card department is insisting on accruing interest on the outstanding dues of someone who has unexpectedly passed away, especially when they were the sole provider for their family. It feels particularly insensitive to expect the grieving family to bear the burden of this debt, which was entirely reliant on the deceased’s income. Adding to their distress, the family has received a meager sum from insurance, barely enough to cover their daily expenses.
Given these difficult circumstances, are there any specific rules or provisions under which this outstanding loan amount could potentially be waived off?
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QNAL but family is not responsible for unsecured debt of someone who passed away if he left nothing for them.
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HThe person has not left any savings except for a residential plot which is still in his name. But it is the only future for his children.
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MFirst check out the insurance policy on credit card. Major credit card providers have a death policy.
Secondly transfer the property asap to next of kin and let the loan stand.
Once they send a legal notice, they will negotiate. They will waive any interest and penalty during settlement. Sometimes even portions of debt, if they realise they don’t have any means for recovery.
Basically, regular due collection team and settlement team are different in banks.
Once they lose all hope on collection of debt, they send it to the legal team to issue notice . After two three notices, The settlement process starts. Once that process start, you can ask to settle or fight it out in court. Generally bank avoid legal battles.
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MYes. But such legal battles take decades and are costly for banks, not for you.
Every Bank will settle instead of fighting a court case. Especially in such case. They know the media backlash in such cases.
As this is not mortgaged property, it will be very difficult for banks to seize property.
Also the Court hearing will cost next to nothing. If you wanna fight it out. After years, the court will give you the opportunity to settle the debt without interest. General precedent in such cases. As the original loan taker is dead, obligation of debt is on inheritance, not any interest or penalty thereafter.
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MI think banks are not stupid. If you are thinking about yourself, please talk here, DO NOT THINK ABOUT IT, you are much more valuable to your family. Again if the question is really legit, then i think thats what rich people do, they borrow, never pay tax, they die,
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HThank you for concern. But this is one behalf of a friend who passed away unexpectedly due to heart failure. The family is still mourning for the loss and unable figure out their daily expenses, children`s education and aging parents medical aids. They have funds to repay any of the debts.
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QLawyer here.
– Outstanding amounts are paid from the estate (movable and immovable property) left behind by the deceased.
– Legal Heirs, in case they inherit any estate from the deceased, are bound to pay the outstanding debt from the inherited estate only, not from the personal property of the legal heirs.
– The above will apply in case there is no other co-signer/guarantor/surety.
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HWe did try and also asked for moratorium of interest calculation. Bank bluntly denied and said the interest calculation cannot be stopped until the debts are cleared.
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HThe wife of the deceased spoke to the branch manager who asked to deal this with the credit card department. She has mailed and spoke to the credit card department as well, who then bluntly denied.
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