Can bank attach my property for an unpaid loan taken for business?
Can a bank attach my personal property for an unpaid loan taken for my business? I have take a loan from a bank in year 2010 to set up my manufacturing unit under PMEGP Scheme. Half of the loan is in the form of term loan and rest as working capital. Initially there was no collateral security on the sanction letter and bank officials has asked me to keep my House property paper with them without any mortage.
Due to some financial loss, business is not in perfect shape and finally bank has raised RC. I want to know, is there any obligation on my house property since it is not mentioned in sanction letter and how should I get back my papers?
It all depends on the terms of the Loan Agreement. As you have stated that the House title deeds were kept without a mortgage, then it is possible for you to approach the Court to get the Title Deed back.
However, this shall invite a recovery suit being filed by the Bank against you. And in case you are unable to repay the said loan amount, your movable and immovable assets can be attached which shall include your house as well.
Therefore, the the obligation shall come on your house property. We can provide you a detailed and better opinion once we review the terms of your loan agreement with the bank.
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