Advances against Immovable Properties

Banks usually do not prefer to advance money on the security of immovable Properties
or real estates, e.g. land and building etc. on account of the following reasons:
a. Difficulty in ascertaining the title to the property.
b. A real estate is not easily realizable without much loss.
c. Valuation problem
d. A lot of legal formalities such as preparation of the mortgage deed, its
registration, payment of stamp duty etc. are to be completed.
In case a banker decides to lend money on the security of immovable, property it should
take the following precautions:
i. The borrower should be financially sound and the business for which money is
borrowed should be economically viable.
ii. The borrower should have a clear title over the property to be given as security.
iii. The property should be properly valued.
iv. Proper margin should be kept. Generally the margin is about 50% of the value
of the property.
v. The property should be fully insured.

Documents
a. Application for credit
b. Accepted copy of sanction letter
c. D. P. note
d. Letter of arrangement
e. Letter of Disbursement
f. Original title deed of property
g. Certified copy of Mutation khatian.
h. Certified copy of C. S; S. A and R. S. Khatian
i. Duplicate Carbon Receipt (DCR).
j. Site plan/Mouza Map
k. Up to date rent receipt and Municipal Tax receipt
l. Up to date Non-encumbrance certificate.
m. Valuation certificate.
n. Registered Mortgaged deed
o. Memorandum of deposit of Title deed (in case of equitable Mortgages).
p. Registration with Registrar of Joint Stock Company (in case of Company).
q. Income Tax certificate
r. Lawyers opinion.