Legal Question in Banking Law in India
Borrowers property mortgaged (equitable mortgaged) to the bank has been sold by official receiver as the borrower has become insolvent. subsequently guarantor has paid the loan and closed the loan. Borrower (insolvent) is not traceable, to whom can we deliver the title deeds.
Asked on 5/20/12, 7:07 am
3 Answers from Attorneys
J. Radhakrishnan
independent Practice
In terms of Sec.140 of the Contract Act, the guarantor on payment of the debt guaranteed is subrogated to the rights of the creditor. Hence on payment of the debt, the title deeds can be delivered to the guarantor.
Answered on 5/20/12, 9:29 am
ranganathan raghavachari
R.Ranganathan & Associates
You say Bank sold the mortgaged property and then say the guarantor paid the dues. This is contradictory. Kindly clarify.
Answered on 5/21/12, 12:00 am
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