What happens to a loan if a person dies?
We took a car in Oct 2016 with UNION Bank for a period of 7 years in my father-in-law's name. 3 years back my father-in-law expired and we still continue paying the name. We have submitted the death certificate also to the bank. Here the concern is some friends told me that, if the person dies they don't have to pay the loan bank will claim it from the insurance itself. but the bank people not saying that. can you give any advice?
The bank is correct in saying that you are still liable to repay the loan, even though your father-in-law has passed away. This is because the loan is a secured loan, which means that the car is the collateral for the loan. If the loan is not repaid, the bank can repossess the car. Contact us for further enquiry.
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