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Can bank seize mortgaged property that is still under construction
20-Jul-2023 (In Recovery Law)
What will happen if borrower stops paying EMI for an under construction property . Will Bank take over the possession of very same flat for which loan was given or Bank can recover it by taking or seizing the other assets of borrower ?
If the borrower defaults in repaying loan amount as per agreement, the Bank is entitled to recover the entire balance amount of loan together with interest and costs at once. In such an event, the Bank will issue a legal notice and if the borrower does not comply with the requirement of the notice, the bank would be at liberty to file a suit for recovery of money. At such a stage, depending upon the amount pending, the bank would get attached the property of the borrower mortgaged to the bank. If worth of that property is not sufficient to cover the recovery amount, the bank may also seek attachment of other immovable and movable properties of the borrower.
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Raghavendra Rao B.K.
Bangalore | 200+ Answers
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Hi
If you are termed as a defaulter your credit history will go for a toss. If stop paying EMI, the bank can take steps under SARFAESI act and take posession of you property and later try to auction your property. If the property sold fetches the loan plus the interest amount then the loan is closed, failing which steps can be taken by the Bank to recover the balance outstanding by other measures.
Pratap, Adv
If you are termed as a defaulter your credit history will go for a toss. If stop paying EMI, the bank can take steps under SARFAESI act and take posession of you property and later try to auction your property. If the property sold fetches the loan plus the interest amount then the loan is closed, failing which steps can be taken by the Bank to recover the balance outstanding by other measures.
Pratap, Adv
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Adv. Pratap Kumar
Bangalore | 200+ Answers
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