LIVE Online Course on NDPS by Riva Pocha and Adv. Taraq Sayed. Starting from 24th May. Register Now!!
The Indian Constitution Courses

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Chaitanya L (N)     16 November 2021

Buying a financed property from loan defaulter

Dear Lawyer sirs, 

I needed advice on the following:

I am based in Pune and buying a 2BHK flat / apartment. This apartment is in a condominium society. The seller is based in Dubai and has a bank loan from Kotak Mahindra and has been a defaulter since March 2021. I am doing a Agreement for Sale and helping him paying the full and final loan first. After that I plan to do the Sale deed, make the rest of the payment and take possession.  Basically doing the full deal in 7-8 days and ask the seller to come down to Pune during this time. Here are the steps I am taking: 

1 - Pay the loan outstanding to the seller and same day do the Agreement for Sale. 

2- Have the seller close the loan the same day

3- Have the seller pay the pending dues (electric, property tax, society maintenance) the next day or so

4 - take the Loan closure letter (you get it after 2/3 days after loan closure) and submit it to the society for NOC. Use the same letter to attach in the Sale Deed

5 - Execute the Sale Deed and pay the rest of the amount and take possession of the flat. 

My BIG QUESTION - Now, the Original documents of the property are release only after 3 weeks. The Seller returns to Dubai after Sale Deed. Can I take an authority letter from the seller and collect these documents myself from the bank? is there any way I can retrieve the documents after the Sale Deed without the Seller. The seller is not willing to come back again from Dubai after the Sale Deed. I have checked with KOTAK MAHINDRA and they said they give the documents only to the person who took the loan. Is there a legal way to deal with this. Please advice 


Best regards,

Chaitanya L


 6 Replies

SHIRISH PAWAR, 7738990900 (Advocate)     16 November 2021


Bank is right that they will hand over documents only to the borrower. There is no other way to compel the bank for handing over documents to you. Try requesting them the explaning the situation and difficulty of borrower / seller. 

Shashi Dhara   16 November 2021

If bank auctions it then bid it legally ,bank will deduct loan amount and excess amount will be transferred to owner .

G.L.N. Prasad (Retired employee.)     17 November 2021

The bank may accept such an authorization letter if the borrower himself comes and delivers with his signature both in Bank registers and authorization letter.  Get the consent of the Banker.

Kishor Mehta (CEO)     17 November 2021

You are trying to enter deep waters without knowing to swim, this proposal is full of pitfalls take advice from a legal professional of your area.

Dr J C Vashista (Advocate)     18 November 2021

It is appropriate to engage / consult a local prudent lawyer for appreciation of facts, professional advise and necessary proceeding.


Please find out from Bank whether or not possession/auction notice is given.

Please note Bank is beneficial owner and seller is not real owner.

Please give public notice in the Press and preferably take Bank's no objection.

As informed by other Learned colleague please do consult lawyer before giving any advance.

Haste makes waste.

Good wishes

Dr Vedula Gopinath




Leave a reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Post a Suggestion for LCI Team
Post a Legal Query