1) Restructure of NPA Account
Restructuring is a kind of rescheduling the repayment terms which gives additional time & new monthly EMI, so the Borrower can approach their bank to restructure their loan while remaining in the same bank. This option gives some additional years for repayment and borrowers can enjoy banking facilities. This is a kind of extension of a loan. This product completely depends upon banking policies & the bank will hold complete rights to decide to go for it or not.
2) Legal Solutions
The client can approach their respective district or state DRT courts for taking time for repayment & put up a hold on bank proceedings. Generally, this can be done by depositing 20-25% of the amount out of the total outstanding amount. This way time is given for further repayment of the loan and the borrower gets relief from the proceedings of the bank if he fulfills his commitments in court.
3) One Time Settlement (OTS)
If the borrower has arranged for money to repay his NPA loan, then he can approach the bank & ask for a one-time settlement This feature allows the borrower to enjoy some discount on the total outstanding of the loan. This is the best way to control or wipe off heavy dues on loan accounts. This feature encourages both client & bank to settle down NPA accounts as NPA accounts are also critical for the bank balance sheet. There are some institutes regulated by RBI, that can fund the entire or part of OTS amount as per requirement and repaying capacity. It’s better to hire a Finance Consultant for this as they are more knowledgeable & experienced on the subject.
4) Loan for NPA Account
Taking a new loan will be the best option for NPA to clear off their NPA liabilities and to come out of the financial & legal disputes with the previous bank. Borrowers can apply for this new loan in some financial institutions that are especially providing loans for such NPA borrowers. Through this new loan, borrowers pay off bank dues in total & get out of this mess. Borrowers can arrange this new loan which is available in the market for the part or entire amount that can be financed. It is highly advisable to hire a Finance Consultant for this as they are more knowledgeable in the subject and they have ready connections for such kind of differential financing.
Apply a Loan to clear off the NPA Account
5) Paying Loan through Sell of Collateral
Borrowers can do this in two different ways. First selling of assets or property which is not mortgaged in the bank. This way, the borrower can arrange money without any interference from the bank & pay off his loan. Secondly, if an asset or property is mortgaged in the bank then the borrower can speak to the bank directly and tell them his intentions of paying off debt through this tool. And if the bank allows then he can approach the bank with the prospective buyer. This whole procedure can be achieved through a tripartite agreement between the bank, borrower, and buyer or any other way suggested by the bank.
