One of my friend is lift chit amount,after he is stopped paying and now he escaped from village. I am one guarantor from 5 members.Here all 4 guarantors are also escaped from village, i am a business person,i am always stay in my village it is needed,the fund members asked to pay full amount to pay from me alone. Here my main question is ,is this amount is paid by me or all 5 guarantors. Is it possible to avoid this problem if i handover the barowed person. The chit fund is not asking the amount from chit member,they coming to my shop with legal attach,what to do. Pls advice i am not understand it is too panic to me.
1) liability of principal debtor is coextensive with that of guarantor
2) creditor can proceed against both or against the guarantors alone
3) in the event you pay the amount you step into the shoes of the creditor and sue the principal debtor to recover your money
4) don't keep any property in your name
1. It is the responsibility of all the 5 guarantors to secure the money and you alone cannot be held responsible for the misdeeds of your friend.
2. At the most you can be held responsible for 20 percent of the stake amount.
3. If you can find the borrower and hand him over to the conductor of the chit business then also your liability as one of the guarantors subsist but the recovery has to first start from the borrower and if he defaults only the other 5 guarantors are responsible.
4. If people are coming to your doorstep and threatening then think of taking help from the Police.
Hello,
Go to the nearest police station and lodge a complaint against them, a guarantor is not responsible to pay the amount, at max what you can do is that you can help the police in investigation. Do not panic.
Regards
As a guarantor you will be held responsible for the defaulted amount.
You have to pay the amount to the lender which you can officially recover from the borrower by filing a recovery suit against him later on.
The lender has all rights to recover the defaulted amount from the available guarantor.
