Legal Notice Format for Recovery of Money

Vakilsearch- Legal Notice Format For Recovery Of Money

If you have money on deposit with an online or mobile money lender, you need to make sure that the agreement includes a legally binding legal notice for recovery of money provision. This will ensure that the lender notifies its customers of their right to withdraw their cash and pay back their loans.

Writing this provision in the loan contract is one way to do so. But there are also other ways to enforce it. For example, you could use ancillary agreements, such as prepaid debit cards or phone cards, which can be used to withdraw cash from any ATM that accepts them. In addition, if your money is on deposit with an online or mobile money lender, it may be easier for you to enforce this provision if you can obtain a court order requiring the lender to give you access to your funds within a certain period. This is known as a “Notice of Withdrawal” (NOA). Here’s an example: say your loan agreement requires you to access your money every three months and provide proof of withdrawal every six months. As soon as each month arrives and the six-month grace period has passed, all hell breaks loose! The first thing you know will be a flurry of legal letters demanding repayment before April 1st!

(That’s when the next monthly repayment deadline falls.) Thus begins the clockwork chase that never ends — trying to collect money owed after the clock has run out on another month’s scheduled repayment schedule. END

What is a “Notice of Withdrawal”?

A notice of withdrawal is a legally binding contract provision that you can use to withdraw your cash from an online or mobile money lender, or any other business that allows you to make cash withdrawals. The rule of thumb is that

any agreement that requires you to make a payment of some kind, such as a lease or credit card bill, also fits the definition of an “advocate notice”. Thus, you would have to read the contract carefully to see if it mentions any limitations on the amount or timing of withdrawals.

How to access your money in a Notice of Withdrawal The easiest way to access your money in a legal notice sample is to take it out of the account used to make the initial loan. Remember, the lender will likely inform you of this option at the time of loan origination. But if you don’t take steps to ensure that the lender’s legal notice format is included in your loan contract, you may miss out on a very easy way to get your money back.

You also may be able to withdraw cash from an ATM, but doing so may incur a fee.

When to use a Notice of Withdrawal Typically, a lender will start to charge you fees and/or impose a late-payment fee the moment you miss a scheduled repayment. Thus, you should always use a notice of withdrawal the moment you first notice that you are struggling to make payments. For example, say you borrowed $1,000 from a friend six months ago. On the first of each month, you should check your account to see whether you have any money left. If not, you should immediately call the lender and arrange to have your outstanding balance transferred to a checking account. Make sure you keep this date and time in your notes so that you can follow these steps if you need to borrow money again shortly.

Example notice: A payday loan with a one-year grace period Here’s an example notice you can use to enforce your right to a one-year grace period when you take out a payday loan: If you have a short-term money-grubbing problem that you need to solve as quickly as possible, a one-year grace period is ideal. But, as you can see from the above example, you should also take into account your ability to pay the loan back when you have a grace period. In other words, if you can’t make any payments at all, then a one-year grace period is actually a good thing because it gives you time to pay off the loan and stay out of debt.

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Conclusion

If you have a short-term money-grubbing problem that you need to solve as quickly as possible, a one-year grace period is ideal. But, as you can see from the above example, you should also take into account your ability to pay the loan back when you have a grace period. In other words, if you can’t make any payments at all, then a one-year grace period is a good thing because it gives you time to pay off the loan and stay out of debt.