A banker has financed an amount of Rs.18,00,000/- but the builder is registering sale deed for Rs.13,40,000/- and actual sale of the property is for Rs.22,40,000/-. Now the question is for what amount equitable mortgage (Memorandum of deposit of Title Deeds) to be created loan amount or sale deed amount? Please help.
Asked in Property Law from Vizianagaram, Andhra Pradesh
It is black and white business of the builder,which is totally illegal and liable for prosecution . You are advised to get the sale deed registered @22,40,000/- as agreed amount and the paid amount to the builder. The Memorandurm of deposit of title deeds should be created at laon amount. If the builder refuse to execute the registration of the deed of sale for full amount, you can approach to the court Infact the expenditure of full amount registration will be costly but the paid amount will be secured .
A. The Bank can create a charge or recovery the amount of Rs.18,00,000/- which amount financed by the bank. An equitable mortgage only transfers a beneficial interest in the asset to the mortgagee, with full legal ownership remaining with the mortgagor.
B. You are liable to handing over all documents in connection with the mortgaged property and when you become defaulter that the bank can be initiate legal proceeding against you with respect to balance amount. Subsequently, after the auction of the property that the bank has bounden duty to return the excess amount after the deduction of balance amount.
C. A mortgage by deposit of title deed does not require registration. Sometimes, a memorandum accompanies the deposit of title deeds. This paper examines the circumstances under which a memorandum accompanying the deposit of title deeds requires registration.
1. equitable mortgage will be created for the loan amount of Rs.18,00,000/ financed by bank.
2. builder must register sale deed for RS.22,40,000/
Advocate, New Delhi
A. Usually Sale Deed would be registered as per the market value of the property in the absence of total consideration amount in the Sale Deed due to save the Registration expenses. And still the same process going on in Karnataka also.
B. In the meanwhile, you have to know the actual market price in your area and check with respect to the same. The bank can mortgage the property is only Rs. 18,00,000/- not Sale Deed amount. For more clarification contact local lawyer with respect to the same.
You must buy the same for actual amount of 22 lakhs if it seen that you have written under value you will be fined and will have to pay penalty
1)since bank has advanced loan for sum of Rs 18 lakhs equitable mortgage by deposit of tile deeds will have to be for Rs 18 lakhs only .
2)since builder wants part of sale price in cash he would be insisting on registering sale deed for Rs 13,40,000. inform the builder that since loan amount has been advanced for Rs 18 lakhs sale deed should atleast reflect the loan amount advanced by bank .
3) equitable mortgage has to be registered .
Since the bank loan is for sum of rs18 lakhs the equitable mortgage registered should be of 18 lakhs coz the sale deed should not be less than the loan amount advanced by the bank.
Hi,in order to save the stamp duty they have registered the property as per guidelines value if you ready to pay more stamp duty you can register the flat on actual amount paid to the builder and bank has advance sum of Rupees 18 lakhs and equitable mortgage deed has to be executed on the actual amount advanced.
1. Before the loan amount was sanctioned against the mortgaged collateral security, the Bank will collect valuation report for the property from its approved valuer which is independent of the amount at which the said deed has been registered or mentioned as the sale consideration amount,
2. The Equitable Mortgage by taking deposit of the Title Deed will be to secure the loan amount with interest thereupon once the said loan account becomes NPA.