Want to sell property along with your pending Home Loan? Here is everything you can find to sell a property with an ongoing home loan.

By Abhay Shah, Realty Quarter

As the property market is reckless, selling a residential apartment can be difficult. But certain factors like location, apartment design, and public transport can influence people to buy a property. This all factors are generally considered by a buyer, but the only factor which can ruin the deal is the existing home loan.

Below is an example which can help an individual to sell his/her property.

Dinesh Sharma purchased a 2BHK house in 2017. He chose to sell his estate in 2019 because he wished to purchase a 3BHK unit in a project close to his office. On his current estate, he has an outstanding house loan and the original estate papers are with the bank.

Can he sell his property with the home loan?

Yes, the property can be transacted by an individual that has made use of a home loan. The sale transaction, however, provides that the owner obtains NOC or the lender’s approval to this sale transaction.

How to sell a house with an outstanding home loan?

A property may be sold after the approval or consent of the lender is obtained. “This must take place in such a way that portion of the sale consideration is paid straight to the lending bank or the lender and the rest (if any) is paid to the current owner (seller).

The original title deed of the estate registered with the lender bank at the time of the loan disbursements shall be released to the seller/current owner after completion of the total loan consideration is been paid.

The original title deed is usually released by the lender, the registration of the sale deed and the discharge of the sale consideration simultaneously,” describes Niraj Kumar, an associate of DSK Legal.

What all things to be considered by the buyer/seller?

You can buy a mortgaged property, if you are getting better value for money or if you like the place or if you are receiving a fully furnished house without additional cost.

“It is advisable for the customer (an individual or a legal entity) to verify that the original title documents, mutation records, encumbrance certificate, and a litigation investigation on the property to confirm whether the possession is in favour of the current owner,” Kumar said.

Kumar adds: “The seller shall also review documents which verify the ability and accessibility of the buyer to transact the estate, and also sources of funding used to buy the estate.”