CAR PURCHASE

Save Share

This query is : Resolved

Quick Summary

If your friend is purchasing a car with a bank loan and is unable to make EMI payments, the bank has the right to repossess the vehicle. The bank will have a hypothecation entry on the car's RC book, signifying their claim. While banks may offer some grace period with penalties for missed payments, ultimately, failure to pay can lead to the bank taking possession of the car.

P. SHARMA

P. SHARMA (Querist)
Follow

08 August 2020 One of my friend will purchase a car . Suppose car value of Rs 750000/-. He will pay of Rs 195000/- as a down payment . Bank will provide the loan of rest of the amount.

please inform me, if he is unable to pay the EMI , ownership of the car to be transfered to the Bank.

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
Follow

09 August 2020 Yes....Bank gives some time for EMI payment with fines and penalties. but Yes...Bank will take the possession of the car if everything fails...

Message likes : 1 times

CA PARTH SHAH

CA PARTH SHAH (Expert)
Follow

09 August 2020 Since the bank has provided the fianace to purchase the car, bank will will create hypothication on the vehicle. You can check the RC book of the vehicle in which you will find the entry of hypothication. Hence if the your friend will not pay EMI, bank has right to take the possession of the vehicle.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now