Paid back loan not cancelled mortgage deed can lender ask for money

931 votes

In the absence of valid registered document in place the concerned or aggrieved party do have all the authority and right to escalate the same in court. In the case if B is going to file suit for recovery, he will fighting a losing battle as he does not have original document and i hope even possession. So any attempt by B to file suit will be numbered , but he cannot succeed provided if you can prove that you had already paid the due amount and the suit is barred by limitation.

Advocate RS Raghavan LawRato

542 votes

Yes, as " A"'s mortgage deed was registered instrument it should be cancelled to hold a clear title. There is a fair chances for "B" or his legal heirs succeeding the demand on the money paid by "B" with interest though a recovery suit if the delay was condoned by the court.

Need to look at the Mortgage deed for determining the kind of mortgage entered by "A" and "B" as the above fair chance will not be applicable for some Usufructuary mortgage where the money paid by "B" will be satisfied by rents collected or possession enjoyed for a certain period of time.

Advocate GP Vijay LawRato

941 votes

The omission to get the endorsement of cancellation of mortgage registered is not fatal and does not entitle B for filing a recovery suit. The endorsement 'CANCELLED' on each page of original mortgage deed is an evidence to prove that the mortgage loan amount was fully discharged and the omission to register the same was oversight and not intentional. Also it is more than 12 years i.e., 40 years after the loan was discharge as on this date hence B has no grounds for anytype of recovery whatsoever it may be.

Advocate T Kalaiselvan LawRato