I have given personal guarantee for a loan Taken by a company promoted by us.For this loan i have given a few of our properties as collateral and my brother's also have given 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?
Look properties which are not given as security/under guarantee are free from all encumbrance. You are free to deal these properties in any manner.
if the account becomes NPA than before the court order status quo on properties or attachment, it can be alienated.
You can deal with other properties which are not given as collateral security
2) you can sell the properties or gift the properties as your account is not declared NPA .
3) even after account is declared NPA you can sell other properties to repay the loan
1. Before you are served with a notice by the lending Bank not to dispose of or not to create charge on your other properties which have not been given as collateral, you will be free to deal with your other properties which are not secured to the Bank as of now.
2. You will be free to deal with your other properties which are not secured to the Bank till the account becomes NPA and before the letter addressed to you is received, not to create charge on your other properties not secured to the Bank so far.
3. You will be free to sell or gift such properties, which are not secured to the Bank after the account becomes NPA but before you receive a letter/notice from the Bank not to dispose of or not to create charge on the properties which have not been given as collateral security.
If your other properties were not given as collateral security towards the company's loan then it will not come under loan repayment obligation.
The lender will attach only those properties given as collateral security by the guarantors.
The lender will go behind the properties of the borrower/applicants in the event of NPA besides the collateral properties.
Dear Client,
You are in fact free to handle any property that isn't pledged as collateral for a bank loan. Until the collateral is delivered, you can gift sell even if your account is non-performing. You are welcome to sell or give away your belongings.
Hope this answer proves beneficial to you.
Yes you are free to deal with them
Yes you can deal with other properties feely. Even the mortgaged property can also be dealt with as your wish except selling or transferring etc.
- The properties which are not given as collateral security for obtaining the loan will not come under preview to recover the loan amount
- Hence you are fee to deal with those properties in any manner
- Further, in case of NPA , the bank can recover the loan amount after auctioning the property kept as collateral security.
