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Builder took loan against the property that was sold to us
01-Jun-2023 (In Property Law)
agreement to sell of my flat is 9th may in2008. Agreement is registered & stamp duty also paid. But our builder borrowed property loan from private bank in the month of June 2008. Builder is unable to repay property loan up to till date. Now private bank gave noticed of auction to all flat owners. Now question is what to do to avoid auction?
Many a times, the developer has the title to the plot of land and takes a loan from the financial institution to fund the construction of the housing project. In that case, the land and its original documents are kept as mortgage with the bank against the loan. The bank then issues a no-objection certificate to the developer for the sale of flats in the project to recover its loan. All the clauses are mentioned in the agreement the buyer signs with the developer. A developer cannot mortgage the project after he has sold off the apartments. If he has done so, it amounts to cheating and a criminal case can be filed by the buyers against him. When the investor is already the owner of the property, how can the developer mortgage it to another party. The buyer's ownership rights are protected in this case.
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Adv. Siddhant Sharma
Delhi | 200+ Answers
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