Yes you are free to deal with property which are not given in security of the loan with bank. You can gift sale even account is NPA your liability is till the collateral given.
Personal guarantee
I have given personal guarantee for a loan Taken by my cousin.For this loan he has given a few of his properties as collateral and I also have given a property as collateral.My question is am I free to deal with my other properties which are not secured to the bank?If yes then till when can I deal with those properties?Can I gift or sell those properties if the account becomes NPA also without attracting the provisions of fraudulent conveyance?
Asked 5 years ago in Property Law
Religion: Hindu
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12 Answers
You are at liberty to deal with other properties which are not given as collateral
2) once account become NPA avoid dealing with these properties
1) Yes, you are free gift or sell your property.
You are free to deal with all properties, regardless. However, in respect of the secured property, the Bank would have a lien on the same, as the same is used as a security, by way of mortgage/hypothecation. In case of dealing in such secured property, the purchaser must be informed of such mortgage and hypothecation, and suitable Indemnity Bond may be issued thereof to make good the loss, if any to the interested purchaser of such secured propoerty.
Dear client,
Properties which are not mortgage under guarantee, no issue. Can be sold and gifted.
No act of fraud.
You can transfer or dispose the properties which have not been given as collateral security towards personal guarantee for the loan availed by your cousin.
According to to some experts here if I transfer my unsecured properties after the declaration of NPA the bank may file a case of fraudulent transfer saying that the transfer was intentionally done to evade creditors.I want to add that I had transferred the unsecured properties after the account was classified as NPA but a couple of days before I received the NPA notice by registered post.So where do I stand now? Regards
Asked 5 years ago
There's no problem with regard to unsecured properties in this connection.
Have they issued any notice with regard to unsecured properties, if not then don't worry about it since they were not offered as collateral security, you can challenge their claim if any properly.
See the unsecured properties of guarantor cannot be attachéd he can be made liable till extent of secured properties.
1) bank can take legal proceedings to set aside transfer of property after account was declared as NPA
1)You can't sell an asset pledged as collateral.
2)You can sell other properties.
Dear Sir,
You being a guarantor and your liability is limited to the extent of property which is secured with bank. In fact the bankers cannot declare your personal account as NPA when principal debtor fail to discharge his liabilities. You are free to deal with your other properties without any hesitation. Please go ahead.
yes you can till the said bank doesn't take any injunction order against you for the said properties if loan defaulted.
