Consequences of Loan Default
Missing an EMI isn’t just about a late fee; it is a breach of contract that can freeze your financial life for a decade.
- The 7-Year Stain: A default can drop your score by 80 points and remain on your report for 7 years, blocking future loans and even jobs.
- Asset Seizure: Under the SARFAESI Act, banks can seize and auction your home without a court order if you default for 90 days.
- Criminal Liability: Cheque bounces can lead to up to 2 years of imprisonment under Section 138.
Watch this video to understand why “Default” is a trap door, and what to do before the legal machinery starts.