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Manikantan (junior)     29 January 2011

discharge of surety

will a surety be discharged if a the mortgage security offered by a Co surety is diluted  without his consent 


 3 Replies

M V Gupta (Advocate)     29 January 2011

If the Guarantee agreement contains anti discharge clauses, and gives power to lender to vary the terms of the loan without consent of the surety,then the  surety will not get discharged.

Manikantan (junior)     30 January 2011

But Sir when there is forgery and fraud would the surety still be bound, to brief if the signature of the co surety in the mortgage and the guarantee has been forged, no valid mortgage or guarantee arises, in such a case will the liability of the surety not get discharged regardless of the contract.   

M V Gupta (Advocate)     30 January 2011

If the documents are forged you should take steps to get them nullified by filing a suit . Get a legal notice issued to the Mortgagee(i.e., the person to whom the guarantee and the mortgage are given).

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