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Amit D   25 September 2024

If borrower is contesting the loan notice sent by lender, can lender sell flat mortgaged directly?

I am the lender.  I gave Rs. 85 Lakhs to a friend. He deposited title documents of a flat with me and signed a loan agreement.

He is contesting the interest rate saying it is too high. It is 18% simple interest per annum. It is what the loan agreement states.

Can I just go and sell the flat? Or do I have to go to Court, sue him, etc?



Learning

 8 Replies

Dr. J C Vashista (Advocate )     25 September 2024

As there is no stay / injunction against you accordingly there is no such restrainment to dispose off the property, if otherwise you are entitled/ titleholder. 

Real Soul.... (LEGAL)     25 September 2024

You cannot sell without court order, you have to file suit for decree 

1 Like

Amit D   25 September 2024

Dr. Vashista, I only have title Deeds with me and an MOU but he is contesting the interest rate in the MOU.

Rama chary Rachakonda (Secunderabad/Telangana state Highcourt practice watsapp no.9989324294 )     25 September 2024

1 Like

T. Kalaiselvan, Advocate (Advocate)     25 September 2024

The property documents handed over to you are  collateral security for the loan amount.

You may file a suit  for recovery of loan amount and file an applicaiton along with the suit requesting the court  for attachment of his property before judgment for security stating that he is trying to sell the property by some fruaudlent means.

Then you conduct the case and obtain a decree in your favor subsequent to which you can file an execution petition to execute the court orders for recovery of your loan amount in the manner as prescribed in law,.

1 Like

Amit D   25 September 2024

Thank all of you for a good set of suggestions. It appears that I will have to go to Court. I cannot sell the flat directly. That is what he wants me to do to just drag the issue. Is my reading on his strategy correct? In any case, it will be difficult to sell the flat because nobody will want to buy one in the middle of a dispute.

T. Kalaiselvan, Advocate (Advocate)     27 September 2024

You were informed that without a court order the property canot be broughy under auction sale, hence you may have to wait for the court to pass an order to sell the property if the money recovery suit is decreed in your favor and the court is passing an order to sell the property in the execution petition.

 

Dr. J C Vashista (Advocate )     28 September 2024

Being an equitable mortgage by deposit of title deeds you cannot sell the property under mortgage.


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