Request Letter to the Bank for One Time Settlement of Loan

If you are facing a severe financial crisis and have missed payment of instalment for any loan taken from a bank and if the bank has been pressurizing you too to make the payment, you may request the bank for a one-time-settlement of the loan account by making a payment less than the total outstanding amount.

In case, you do not wish to spend money paying the interest on the loan and have money for paying off the principal and interest outstanding as on date, then there is no need for one-time settlement. You can approach the bank for a pre-closure of the loan account.

Here is a sample of a request letter to the bank manager for a one-time settlement of your loan account.

TEMPLATE

Date: __________

From

(Name of the Loan Account-holder)

(Registered Address)

(Telephone Number)

To

The Branch Manager

(Name of the Bank)

(Name of the Branch)

(Address)

Sub.: Request for a One-Time Settlement of the Loan

Dear Sir/Madam,

I am currently having a loan account bearing the number __________ in your bank at ______ branch. The loan account shows the principal outstanding for Rs. __________ and interest overdue for Rs. _______ as on (Date).

I had taken an educational loan for admission in (Name of the Institution) for (Name of the Course) during (Year)-(Year). After completing the course, I started looking for job opportunities. I was working in an organisation for around ___ months. Hence, I was able to make payment of the loan instalment amount for a while.

However, that job did not last long, as after the completion of the project; some of the employees working for the project had to be laid off by the employer. Ever since, I have been looking for another job but I have not been able to get one yet. This has led to non-payment of the loan instalment for the last several months.

Your collection team has been following up with me, which is putting a lot of pressure on me in addition to my worries of having no job. Some of your collection agents have also visited my home and have been demanding payment, which has created an embarrassing situation for all of us in the family.

Therefore, I have a proposal that I am willing to opt for a one-time settlement of Rs. _________ (Rupees _______________ only) in order to close the loan account. I can make the payment by (Date). Even though there will be great hardship in arranging this money, I am still willing to do it for the good of both the parties involved.

I hope your goodself will appreciate my financial situation and consider my proposal favorably. I kindly request you to settle the issue for the amount suggested by me please.

Thanking you,

Yours faithfully,

    (Signature)

(Name of the Loan Account-holder)