Unreasonable interest on money lend

Hello sir, My name is Baibhav Kumar, i am a employee in a private IT firm. 4 years ago my mother had taken a loan from a person of 1,60,000/- and agreed to pay interest on it. The interest came out to be around 8000 per month but the other person and my mother had no paper agreement for the amount and this was all in mutual understanding. It was going well for sometime but my mother got really ill and we were unable to pay interests on time and due to her long sickness we were not able to pay interests. By the time the other lady had somehow made a new calculation and the principle amount was then 2,00,000 (i dont know how). Now after 4 years we are not paying that much interest to her but she has piled up an amount of 4,00,000/-. She is actually charging interest on the principle as well as the remaining interest which is totally wrong. All this was hidden from my father and she took advantage of this and threatened us to sign on an agreement of 4,00,000/- and she had made a license of this few weeks ago and took our signatures on a stamp paper. But she still threatens us to pay interest on this entire amount. What to do sir, please help