Personal loan with bank overdue 2 months and just lost my job. What will happen next?

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asked on Aug 23, 2017 at 17:29
edited on Sep 27, 2017 at 07:17
I have personal loan with RHB Bank RM 30,000. I have 2 months outstanding payment amounting RM 1,547.15. I just lost my job and I am not able to pay the amount. I am really worried on few matters.

1. Will RHB Bank block my savings account with Maybank within a short time period?
2. Will they proceed with legal notice immediately or they will forward my case to debt collection agency?
3. If I were to receive legal letter, how soon they will proceed with legal notice?
4. Will I be a bankrupt in few months because of my loan amount of RM30,000?

I am having sleepless night because of this, please help me.
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6 Answers

answered on Aug 24, 2017 at 19:18
edited Sep 27, 2017 at 07:21
RHB Bank: Akaun Pinjaman disekat bagi segala transaksi pembayaran. 

I receive this SMS. What does it mean? Are my all my savings accounts being blocked?

I just called the bank, they said that they have blocked my loan account and legal notice has been processed and I am required to make full settlement in 14 days. Does that that mean all my bank account will be frozen and I will be a bankrupt soon.

Please help me to answer this.
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answered on Aug 25, 2017 at 15:30
edited Sep 27, 2017 at 07:38
@ Rajes

Please read thru the past 6 months posts and you understand the bank litigation legal process.

Your loan account is not only 2 months due but 3 months over.
The blocking will not affect other bank savings accounts.

But when they block or "freeze" payments into your RHB loan account means:
a)  Either pass it to bill collectors to recover or
b)  If they are no positive response from the bill collectors or any proposal of settlement from you, they may initiate legal proceedings against you. 
c)  The summons from from court may start 2 months from now and may take another 2 months for the proceedings. Just make sure that you have updated your current address to be contactable for any correspondence from the bank or their lawyers. Attend Court - YOU MUST!
d) After this court case is over and you are made a Judgement Debtor, there are several steps that the bank can take, like Writ of Seizure and Sale (WSS), Garnishment of any/all bank account, and the last final resort is Bankruptcy proceedings when the judgement debt is over RM30,000 (now) or RM50,000 (soon).

1. Contact and make a workable repayment schedule. No money or jobless is not an answer.
2. Approach AKPK  for advice and help. But you must be in gainful employment to be accepted in their Debt Management Programme (DMP). Self employment with banking accounts can be acceptable.
g) Are there any Guarantor(s) for this loan?
h) Leave little moneys in all other banks accounts.

I have answered your this query on 4 August and have advised you to make 1 payment immediately. You did not heed my advice, why ask further? Waiting for favorable answers to your liking and advantage? Now deal with nasty bill collectors first then Court Summons (hopefully not).
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answered on Aug 25, 2017 at 16:01
edited Sep 27, 2017 at 07:59

There is no any Guarantor for this loan.

I called the bank just now, I request for restructure payment but they said my account has been referred to the Legal Department which stated that I need to pay RM31,000 within 14 days. My last payment was on June 28th and I have outstanding payment for July and August.

Since my loan is RM31,000 will they proceed with bankruptcy immediately or they have to go thru legal action as you mention which will take at least 2 months from now?
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answered on Aug 25, 2017 at 16:13
edited Sep 27, 2017 at 08:17
@ Rages

If you are sincere, you go direct to the Bank with a workable proposal in black and white. Calling robots answering machines is useless. They go law by law. Be pro-active if you do not want to be a Judgement Debtor.

My last payment was on June 28th and I have outstanding payment for July and August.
The June 28th should be already in default. You may have miscalculated the dates. You are in perpetual overdue, behind payments every month!

Banks litigation process like hire purchase of motor vehicle is standard. It follows banking and financial standard and procedures.

will they proceed with bankruptcy immediately
Already answered, first go to Makhamah for the first Summons...!! You must be made a Judgement Debtor before any bankruptcy proceeding can start. (At the moment threshold is still RM30,000)

I request for restructure payment
They have restructured your payment.
Pay in lumpsum please legal fees (if any).
You make a Workable Acceptable Restructured Repayment Schedule.
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answered on Aug 25, 2017 at 16:22
edited Sep 27, 2017 at 08:19
You better start reading backwards for the past 6 months in this section of Lawyerment Discussion Forum. You are repeating your basic questions. It is quite tiring to write repeating answers.

You've debts issues. Arm yourself with knowledge.
It is FREE in this Forum.
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answered on Aug 25, 2017 at 21:12
edited Sep 27, 2017 at 08:21
It depends on whether you are guarantor of the loan as well or whether the personal loan is secured (some are). You need someone or yourself to read the agreement and contact the bank (preferably first by phone or in person  and then by letter) to explain your position to the bank.

An important thing to do is to prioritise your cash flow. Make some payment whether it is one or two payments. The loan contract will tell you whether your case of 3 delinquent payments installments means your loan is in default or simply delinquent. Many lawyers do not know the difference and they respond like some do on this website. Again your loan contract is the point of reference.

If it is simply delinquent you have the opportunity to make it good. But the bank is entitled to secure its money by declaring a default if your explanation to them signals a dire situation. 

If they proceed to recovery against you, they must first spell out the terms and conditions of the collection agency's role. Many people think that because a bank has engaged a collection agency you are doomed. It is not the case. You have certain common law rights because they are effectively transferring your debt to another party. In such a case it is important to know what the situation is between the bank and the agency. They may have the right to collect their debt but not to vary the terms and conditions of that contract between you and them.

As they approach sequestration to bankrupt you, you are allowed to delay the process and stop them in their tracks but I won't go into the details of that process with you.
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