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Personal Finance News

The Economic Times

Personal Finance / The Economic Times

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Defaulted on your loan? Here's what banks can legally do and what they can't

Missing a single loan EMI doesn't lead to immediate bank intervention; instead, lenders often issue reminder calls and formal notices first. For secured loans, repossession of assets follows legal procedure, while unsecured loans depend on collection efforts. Recovery agents must uphold borrower dignity, refraining from harassment. Engaging proactively with lenders can facilitate loan restructuring and help preserve your credit score from significant damage.

13 Aug 2026 6:30 am