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When a bank closes, not just one branch of a larger bank, one (1) of three (3) things happen to outstanding loans:
The loan is purchased by a financial institution for primary use
(highly likely) When a loan is purchased by another financial organization for primary use, the intent is to service the loan. At some point (before or after the purchase), they will conduct due diligence in order to determine what loans they have (and, effectively, the quality of what they now own). After conducting due diligence, they will send you a letter indicating that they are the new owner/servicer of the loan and will provide you with an address (and other channels) through which to continue to pay the loan until it is paid off.
At this juncture, the financial company now holding your loan may continue to service the loan or sell the loan to yet another bank if the loan does not meet their
risk and/or return requirements.
The loan is purchased by a financial institution for secondary use
(not as likely) When a loan is purchased by another financial organization for secondary use, they are merely buying the loan in order to drive different value from some other part of the purchase (e.g., I like your assets and hate your loans, but I want your assets so I buy them both knowing that I will sell the loans later).
In this case, the due diligence is more for determining what loans are held and how the loans will be packaged for sale. You will still get a letter indicating a sale and providing payment information, however, you will also likely be told (in the letter) that the loan is going to be sold to a bank to be named within some period of time.
The loan is not purchased/left with closing bank
(highly unlikely) While very unlikely, the loan may not be sold and kept with the closing bank. In this situation, the bank will likely allow the loan to be written off as part of the closing process.
Original Answer:
It wilo have to be paid back to the Federal Bank.
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∙ 13y ago
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What happens if I got a cash advance from the Met Bank and they closed my account?
Metropolitan Bank (or any bank, really) will not cancel a loan unless (1) you successfully are discharged from a Chapter 7 bankruptcy or (2) you defaulted and the bank decided to write it off after collection efforts. If your account was cancelled and you still have a loan outstanding, you are still responsible for making payments on that loan.
If your house is repossessed due to a secured loan and there is not enough equity to pay the loan what then happens to the secured loan?
You will be liable to pay the debt outstanding.
Can a bank refuse to release collateral if they have excessive collateral?
They can refuse if the loan outstanding is much more than the collateral provided. Ex: If you have a loan outstanding of 100,000$ and you have provided a collateral of 50,000$ you cannot expect the bank to release any collateral. Lets say your outstanding is only $30,000 then you can expect the bank to release a certain portion of the collateral atleast $20,000
What happens to a bank loan when a person dies?
If the loan is secured, then the collateral is returned to the bank. If the loan is unsecured, like a credit card, then the bank submits the balance to the estate of the deceased.
What happens if you do not pay a loan back?
If you have provided a collateral like property or bank fixed deposit receipts etc, the bank would retain them and they can sell it to collect as much much money as possible. If you have provided a guarantor, the bank would approach them for payments. If both of the above are not available or both of them put together are not enough for your loan outstanding, then the bank has rights to proceed with a legal filing against you. You can be jailed for this.
What happens if I got a cash advance from the Met Bank and they closed my account?
Metropolitan Bank (or any bank, really) will not cancel a loan unless (1) you successfully are discharged from a Chapter 7 bankruptcy or (2) you defaulted and the bank decided to write it off after collection efforts. If your account was cancelled and you still have a loan outstanding, you are still responsible for making payments on that loan.
What happens if you do not pay your bank loan?
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If your spouse dies then receives a credit on a bank debit card can the bank take that credit and apply it to an outstanding loan that was only in your spouse's name?
Yes, if the loan is at the bank where the debit card was issued.
If your house is repossessed due to a secured loan and there is not enough equity to pay the loan what then happens to the secured loan?
You will be liable to pay the debt outstanding.
What happens to bank loan if you are permanently disabled?
the asset which is kept as morgage with the bank at the time of taking loan is taken away by the bank
Can a bank refuse to release collateral if they have excessive collateral?
They can refuse if the loan outstanding is much more than the collateral provided. Ex: If you have a loan outstanding of 100,000$ and you have provided a collateral of 50,000$ you cannot expect the bank to release any collateral. Lets say your outstanding is only $30,000 then you can expect the bank to release a certain portion of the collateral atleast $20,000
What happens to a bank loan when a person dies?
If the loan is secured, then the collateral is returned to the bank. If the loan is unsecured, like a credit card, then the bank submits the balance to the estate of the deceased.
What happens if don't pay my bank loan?
they hunt you down
My current bank account was closed and someone has been depositing money to it can the bank use this money for an outstanding loan?
my bank closed my account can i reopen the same account again
What happens if you do not pay a loan back?
If you have provided a collateral like property or bank fixed deposit receipts etc, the bank would retain them and they can sell it to collect as much much money as possible. If you have provided a guarantor, the bank would approach them for payments. If both of the above are not available or both of them put together are not enough for your loan outstanding, then the bank has rights to proceed with a legal filing against you. You can be jailed for this.
Define outstanding loan?
Difference between loan disbursed and loan outstanding; the unpaid remainder that you still owe.
You are needing a loan you have 2 outstanding loans now who will give you a loan?
Maybe you could get a consolidation loan from the bank - what that means is they pay your other 2 loans off and give you one big loan through them that you have one payment for.
