Mortage to Muthoot finance
I had mortgaged my gold of 80 gms and took a loan of 1.6 lakhs. I paid some interest for about 6 months, but could not pay now for around 1 year. I received a call several times and I told them to auction the gold. I received a third notice from them telling me to pay interest otherwise they will auction the gold and recover any remaining money after 7 days. Still after 6 months more, I get call from them to pay the interest. I stated clearly to them to auction the gold and recover their money. Now I want to known what else they can do and what I can do. I do not want my gold since I do not have money to pay back principal and interest. Please advise.
Asked in Civil Law from Faridabad, Haryana
Please see the agreement/pledge/mortgage document executed there must be a clause that they will auction the gold if dues/interest not paid after certain period. Give them legal notice that you have already informed them to auction as do not have money to pay interest and claim balance amount after adjusting the amount of interest due out of total auction amount received by them.Also tell that auction be done in your presence.
Advocate, New Delhi
Before auction a Pre-Sale Notice would be issued to the you giving you a time line of 7 days to make payment of the outstanding dues. The Pre Sale Notice would clearly mention the details of the concerned office and the corresponding contact person for payment of remaining balance.You can get some time to re-pay the same if you file a Declaration Suit in Civil Court questioning the interest rate.
If your gold is already auctioned try to findout at what rate it was auctioned and when the auction was conducted. Find out the realized money after auction minus the principal amount + interest due from your side. If there is any leftover money subsequent to auction after deducting the principal amount + interest, demand from them that the money recovered from auction over and above the money due from you, is to be paid to you. On the other hand if there is any shortfall in the proceeds of auction money to set off the loan and if they are pestering you to pay interest take the stand and inform them that gold was pledged for a lower amount than the market rate and the matter should end there, if it does not end, issue a legal notice through a lawyer stating that since you were unable to service the interest and had informed them time and again about your inability and had requested them to auction the gold.
However a look at agreement you would have entered with them at the time of pledging gold has to be seen before coming to conclusion.
You can send a legal notice to them and claim your remaining balance amount if any. As stated above expert Mr. Sastry
Advocate, New Delhi
Hi, you can give a notice them to auction the gold and remaining amount will paid after the auction.
1) you have only orally informed the finance company to auction the gold on account of your inability to pay principal with interest .
2) you should send them notice in writing as per clauses in your agreement to auction the gold on account of your inability to repay the loan amount
3) in the event of any shortfall in recovery of loan amount with accrued interest the finance company will recover the shortfall from you
1. The said lending company has very cleverly dragged the issue and has not auctioned your gold which you have asked hem to do to recover your outstanding dues,
2. Because of the above act of the said Company, your loan is attracting interest which is income of he Company and will be ecovered by selling our gold,
3. Interest rate is still lower than the increase in the gold price for which the Compan is not settling our dues,
4. Send a legal notice to the Company stating that you will not pay any interest for the period from the next month of your sending the letter to the Company to sell your gold.
If the market value of gold you pawned is les than that you owe the financer as principal and interest then forget about their notice etc .
Advocate, New Delhi