Is it possible to avail Agri loan in Tamil nadu against PATTA land
A customer has approached bank for agriculture loan. But the land is patta land, and our advocate has opinioned that only simple mortgage is possible. Whether the same can be mortgaged? Why is it that advocate has not mentioned equitable mortgage?
Asked 3 months ago in Property Law from Coimbatore, Tamil Nadu
The Patta is the legal document, which is issued by the Government and is in the name of the actual owner of any plot of land. Mere patta cannot decide title of holder of patta as such after scrutinizing documents your advocate may have advised for simple mortgage as in equitable mortgage you need to secure all documents of the property.
The on patta land I.e non agriculture land agri loan is not possible though you can mortgage the land and can get loan according to its valuation. And the loan shall be equitable mortgage as title.will be with bank
An equitable mortgage in which the lender is secured by taking possession of all the original title documents of the property that serves as security for the mortgage.
It is always at the discretion of bankers loans will be advanced. You cannot insist upon particular type of mortgage. You get the loan and enjoy.
Seems mortgage by deposit of title deeds seems to be a viable option as borrowers cannot alienate the property, as entry will be in the EC.
it is for bank to take a call whether loan by deposit of title deeds ie equitable mortgage should be granted or not
2) in simple mortgage The Mortgagor binds himself personally to pay the mortgage money to the Mortgagee and also agrees expressly or impliedly that in the event of the Mortgagor failing to pay the mortgage money to the Mortgagee as per the terms of the mortgage contract relating to simple mortgage, the Mortgagee has the right to cause the mortgaged property to be sold and the proceeds of the sale to be applied as far as may be necessary to completely cover the repayment of the mortgage money payable by the Mortgagor to the Mortgagee.
A Patta is a legal document issued by the Government in the name of the actual owner of a particular plot of land.
Equitable mortgage is valid.
I think his title in the property is not in dispute ?
For equitable mortgage the registered title deed may be an essential requirement, hence the advocate might have suggested a simple mortgage for the Patta land.
If the title and ownership of the land has bee conveyed by the government by means of a patta, the patta itself is treated as the original title-deed. In that case mortgage by simple deposit of title-deeds can very well be created. Then a registered memorandum has to be filed in the Registrar's Office.
yes the same can be mortgaged
Moreover, it is upon the bank to take a call to give a equitable mortgage or not
Advocate, New Delhi
All banks will give loan against approved land. The amount of loan given by various banks will depend on the risk analyzed by the risk assessment office. I would suggest that you visit various banks to find out the extent of loan that they will give.