Paying the bank or paying a fine in the police? What is the best option?

Dear Madam,

Thank you for reaching out to me on this!

I understand that the Police have already intimated that your husband will have to pay a fine to clear the police case and the bank lawyer has stated that instead, your husband can pay the amount to the bank to reduce his liabilities.

You need to consider the following before you make a decision:

1- Ensure that you get in writing that the bank is settling the liability for X amount and upon you paying them the first installment, they will release the Police Case.

2- You need to agree with the bank on a fixed amount or else, every month they will keep adding interest, penalty, and misc charges, and in effect, your liability will not reduce and you will simply lose your first installment money.

3- Are they asking for a fresh security cheque? If yes, then bear in mind that if you again default, then they will file a fresh police case. If you give them a security cheque, then ensure you put the amount as per the new settlement and not as per the original loan amount.

In summary, all your negotiations should be put down on paper before you commit to anything as I have personally witnessed bank officials misrepresenting the consumers to claim more money. This is my personal opinion and should not be considered generalized on all bankers.

I trust you will find this helpful.

Regards,

Hari Wadhwana

Dear questioner,

Definitely, we can help you in this case.

If you pay to the bank, then definitely it will reduce your liability, but at the same time, the bank will ask for a new security cheque.

So in any kind of restructuring, if you default on a payment again, you will land up in the same situation.

So it is better to pay a fine for this case.

Please feel free to contact me via phone or email in case of any queries.