Loans availed to get immobile properties usually need the property to be encumbered to the financial organization. until such time that the loan dues are cleared by the person availing the loan, the property remains encumbered. whereas the property is encumbered, one might want to sell it. Since all the first property documents are within the custody of the financial organization till the loan is closed, one will sell an encumbered property with the method expressed below.
‘Loan outstanding’ letter First, the vendor is needed to create an associate application to the financial organization for the difficulty of a loan outstanding letter that states the quantity outstanding as of the date of the letter and also the list of property documents in their custody.
Payment from purchaser The prospective purchaser is needed to create a payment up to the outstanding loan quantity as mentioned within the letter and additionally missive of invitation for loan closure.
No dues certificate Once the financial organization receives the payment and also the closure request, it problems a ‘No Dues Certificate’ with reference to the loan. The property documents also are discharged and two-handed over to the owner.
Sale dealing Once the No Dues Certificate and original property documents are obtained, the vendor is authorized to execute a buying deal dealing and transfer the property to the customer.
Points to notice
• Another choice to execute such dealing is transfer the loan outstanding quantity from the primary recipient to the planned recipient with the identical financial organization (provided the planned recipient is trying to avail a loan).
• While original property documents don’t seem to be obtainable, scanned pictures or copies of the documents are often wont to initiate the deal.