Mortgaging a subleased property
R
(Querist) 05 August 2013
This query is : Resolved
Company "A", a government industrial corporation, is the owner of the land, leases to company "B" the said property for a period of 99 years. Company "B" after taking necessary permission sublets part of the property to company "C" for 5 years. Company "C" wants to avail finance from bank. Can company "C" let bank create equitable mortgage on the subleased property, considering compnay C has taken no objection certificate from the owner and the original lease holder.
If yes, then on the event of default, what happens to the property? Does the bank has the right only for the period of sublease?
R.K Nanda
(Expert) 05 August 2013
no reply to AQ.
ajay sethi
(Expert) 05 August 2013
we dont reply to annonymous queries
ajay sethi
(Expert) 05 August 2013
we dont reply to annonymous queries
Raj Kumar Makkad
(Expert) 05 August 2013
First identify yourself and then raise your query again before the experts.
R
(Querist) 12 August 2013
I am a businessman from Mumbai. My name is Rajesh. Any more information required? This is a real life case my relative has been facing and so I thought to seek experts advice.
Devajyoti Barman
(Expert) 12 August 2013
Bank is unlikely to grant loan on the basis of sub-let property and that to for 5 years only.
R
(Querist) 12 August 2013
Mr. Barman, my question was not whether the bank would grant or not. My question was, if they are willing to, then in case of default, what happens to the property? Does the bank has the right only for the period of sublease?
Dr. Jyothi Vishwanath
(Expert) 12 August 2013
Bank will not grant loan on the basis of a sub-let property. Even if any bank grants it, in the case of default, the bank will not get any better rights than the sub-lessee. It means only for five years, it will get right.
