What happens when one buy under construction property under PRE EMI scheme with bank home loan and Banks pays 100% loan amount upfront directly to the builder and builder fail to complete the project and borrower is not able to pay EMI any more . Will Bank initiate the SARFESI act and take the possession of the house ? But what if the property for which the home loan was availed is still not 100% completed and OC not received ? How bank will recover the loan ? In this scenario , can bank take the possession of other assets of the borrower . What happens if the home loan was availed jointly (Husband and wife , husband being the primary applicant ) ? Can bank take the possession of the assets of the co-borrower also ? Can bank also file any FIR or criminal proceeding against the borrowers . Can borrower challenge in the court if Bank initiate SARFESI act?
In your case bank can claim only the under construction property and not your other properties.
Yes, Borrower can challenge in the court if Bank initiate SARFESI act, but here borrower need to pay EMI and pending amount of all EMI before the order may be pass for auction.
1) bank will invoke provisions of SARFESI act take possession of flat and auction the flat
2) bank can sue the borrower to recover loan advanced with interest
3) you can contest the recovery proceedings
4) bank does not file criminal proceedings against borrower
1.2. Bank has all the rights to recover it loan and can take possession , sale of the house what has been hypothecated under SARFESI ACT if loan has been availed by two or one .
3. Recovery proceedings attracts the civil laws not the criminal laws.
Can you Please inform us whether construction and project started in the year 2016 ?
Whether sale deed or agreement is registered with sub-registrar office.
It is important for us to guide you lawfully.
Even if bank files proceedings of sarfesi Act you can still get a stay on above ground
Dear Sir,
In the present circumstances. the bank tries to recover the loan as soon as possible and it may adopt several methods to catch the co borrower and guarantor as well.
On default in loan repayment the banks are authorized to take legal action to recover the NPA or defaulted amount directly by invoking the provisions of sarfesi act.
The bank is not interested about the OC or completion, if there is a default in loan repayment, after declaring it NPA, it may proceed adopting the legal actions in this regard.
If at all any other assets have been given as collateral security for this loan, then the bank may lay its hand on the collateral property too.
The bank shall not be able to file any criminal case against the borrower for default in loan repayment.
The borrower has defaulted in loan repayment hence he cannot challenge the action initiated by bank.
Yes,
If loan cannot be recovered from the property than recovery from borrower.Cannot take otehr assets but only recovery suit.
Can bank take the possession of the assets of the co-borrower also ? -- No if other property dose not mortgage with the bank as guarantee.
No FRI or criminal office.
Yes before debt recovery tribunal.
in such a case the bank can move against the borrower under section 19 of the recovery of debts due to banks and financial institutions Act for attachment and sale of other assets of the borrower to realise the dues of the bank
- Since, the bank sanctioned the loan for purchasing the said flat in favour of you, and not with the builder , and hence you are liable to pay the emi to the bank , and on default bank can initiate the SARFESI act after serving a notice to you , and further can also take the possession as well.
- The agreement of promise to complete the project is between you and the builder, and not with the bank , if the builder not completing the project and delaying the same , and further OC not received , then you can file a complaint before the Consumer court against the builder , and even take full refund with interest from him .
- Further you cannot file any case against the bank , as bank already fulfilled its requirement after sanctioning loan .
- Bank will recover its loaned amount firstly after selling the said builders flat , and if remains then can recover from the borrowers , and also guarantor.
- if , the builder not paying the same , and doing delay in possession , then for that the builder is responsible for breach of contract /agreement.
- No, such type of cases are not come under the criminal Act.
- No, borrower cannot challenge in the court if bank initiate SARFESI Act.
Yes.
The bank can take away the property under the sarfaesi act and auction it to recover its dues.
It may initiate criminal complaint if anyone teies to create problems ie hindrance.
You may challenge the action of the bank if it is illegal.
borrower can challenge the notice u/s. 13(2) of Act in the Civil Court as well as in the High Courts by way of writ jurisdiction to defend his case.
Yes borrowers can challenge
Dear Sir,
The Courts are very lenient to the bankers and they have powers to take possession of even half finished flats. The balance amount will be recovered from either from the primary borrower or co-borrower or both. The discretion is left to the bank. You have to immediately file a suit against the builder and see that his other properties are attached and put to auction in satisfaction of your purchased apartment. Parallel to that you may file consumer case or RERA case as the case may be. You have an edge to win.
