Excess security can be released banking law
Raja
(Querist) 04 September 2012
This query is : Resolved
In case of mortgage, excess security held, can be released ? Statutory explanation please.
R.K Nanda
(Expert) 04 September 2012
state full facts.
Raja
(Querist) 04 September 2012
loan amount- 1cr
mortgage taken- 3 land property, valued 5.6cr
can bank release the excess mortgaged property
c.p.s. ramachary
(Expert) 05 September 2012
It depends upon the record of recovery and borrower's financial discipline. If the credit appraisal is decided for three securities for the advance, the bank has to take decision as the borrowed amount might have swelled to higher figure on account of loading of interest and other charges. However this is discretion of the lending bank to release excess security but not under compulsion of the borrower. Otherwise better to close the account under 'take over finance' by another bank and insist for security commensurate with the amount of loan.
Raja
(Querist) 05 September 2012
this does not sound good..... i am sorry.
any statutory provisions or citation ?
c.p.s. ramachary
(Expert) 06 September 2012
you may find out a sound citation at your end as you are also a lawyer
Raja
(Querist) 07 September 2012
thats correct...that is the only alternative
