A mortgaged property cannot be sold without the permission of the lender to whom the property is mortgaged, especially if the loan is in default. If the loan is not in default, the property owner can sell the property and get his loan transferred to the buyer, by keeping the lender in the trap.
A delay of one or two months, with a clear intent to make good the default, may not result in the borrower being asked to vacate the property. However, if the delay becomes over 4 months and remains at that stage for a long period or worsens, may get the borrower under law.
Legal procedure depending on the type of legal procedure adopted by the financier, it could take anywhere between 6 months to 1.5 years for the lender to take possession of the property.
Well Vinay,
It could be anytime after six months from the date of borrowing. It is not necessary to serve the whole repayment period. In fact a large majority of loans in the market do not serve the entire repayment period.
Can a delay of one or two months vacate mortgage property? What is the minimum period of making repayment for loan? If a legal procedure taken by the financier, how long it will take for the lender to take possession of the property?
Your welcome Vinay, Interest rate could range from 10-15% or even more depending on the type of loan taken, the lending institution, the borrowers profile etc. and it is payable on monthly basis. Usually loans to purchase homes would be cheaper than Loan Against Properties (i.e. Loan taken against an existing property for some other purpose like travel or business).
Thanks for the valuable information Shrikant, What will be the rate on mortgage property? Would loans to purchase homes be cheaper than Loan Against Properties?
Well Vinay, If the borrower is unable to repay the loan, the lending institution that has the mortgage of the property, can refer to the mortgage as per legal provisions applicable to that institution. It depends on the reasons for default, there could be other repercussions also for the borrower, i.e. if any fraud is detected, the borrower could also be tried under criminal laws.
If there is a delay in payment it would attract penal interest. The borrower would be required to pay the actual due amount and some additional/penal interest on top of it.
HI Vinay, When loan is on and the property is already mortgaged to a financier, one cannot mortgage the property again. However in some special cases a "Second mortgage" can be created with the agreement of the financier who has the First Mortgage.
Mortgaging helps the financier in securing money that has been advanced as loan to the customer. For a customer, mortgaging his property could help him help finance for any legal purpose.
Yes, one can avail a loan without offering a mortgage as well, but Secured Loan (loan taken against security) are cheaper than unsecured loans.
HI Shrikant, Is it possible to mortgage property when loan is on? How is helps the financier and the customer? Can we take a loan without offering a mortgage?
A property owner can consider mortgage to raise money for a wedding, investment in business, higher education of children, among others. However, before dwelling on mortgaging, it is crucial to understand its pediculous..