Re: Legal Opinion on Mortgage Loans
As per your request, we give herein the list of the documents needed to accept any immovable property as security (both legal and equitable):
1. Title Deeds i.e. Deed of Sale in original. If the original is not yet delivered by the Office of the Sub-Registrar, then certified copy of the Deed of Sale along with the delivery receipt duly discharged by the Seller.
2. Bia Deed (i.e. Title Deed of the Seller).
3. Mutation Certificate certified by the Assistant Commissioner of Land.
4. C.S., S.A. and R.S. Parcha and Math Parcha, where applicable.
5. Up to date ground rent payment receipt issued by the Tahshil Office.
6. Municipal Mutation and Municipal Tax Payment Receipt.
7. Non Encumbrance Certificate countersigned by the concerned Sub-Registrar.
In case of leasehold land, the owner cannot produce documents under Serial No. 4. But as additional document, the owner will produce permission of the Lessor to transfer the land in the name of the owner and also permission to mortgage the leasehold land in favour of the Bank. This is applicable even when the property offered as security is a flat with undivided and undemarcated portion of land.
However, in case Bank decides to take an apartment, the title of the flat will not be transferred in the name of the purchaser, until the Developer receives full payment. Until then the Bank cannot get the Title Deed and other related documents. In such a situation, in practice Bank extends facilities against a tripartite agreement coupled with a number of undertakings and indemnity from the Purchaser, Developer, Land Owner and Bank.
In case of equitable mortgage, Bank receives the documents (in original) mentioned above along with a MOD.
In case of registered mortgage, the owner of the property shall execute a Deed of Mortgage in addition to submitting the documents.
If you have any query, please do not hesitate to contact the undersigned.
For: “The Lawyers & Jurists”