1. Your friend probably had used the loan fund to buy home or any asset. He needs to dispose off that asset and repay the loan.
2. The insurance of loan covers only the "Death Risk" of the borrower, and it does not cover the "Non Payment" risk.
No insurance company guarantees the loan non payments, because it is a huge risk which no insurance company is willing/able to bear.
3. To stop the interest application on the loan, he needs to write a formal request to the bank, requesting them to "Stop the Interest Accrual' henceforth.
4. He can also write a request to the bank to "Reschedule" the loan, thereby making new installments plan, based on his new job or source of income.
5. If the loan was guaranteed by another person, then he too is responsible to repay the loan from his salary.
1. Your friend probably had used the loan fund to buy home or any asset. He needs to dispose off that asset and repay the loan.
2. The insurance of loan covers only the "Death Risk" of the borrower, and it does not cover the "Non Payment" risk.
No insurance company guarantees the loan non payments, because it is a huge risk which no insurance company is willing/able to bear.
3. To stop the interest application on the loan, he needs to write a formal request to the bank, requesting them to "Stop the Interest Accrual' henceforth.
4. He can also write a request to the bank to "Reschedule" the loan, thereby making new installments plan, based on his new job or source of income.
5. If the loan was guaranteed by another person, then he too is responsible to repay the loan from his salary.