LAHORE: Some mortgagors are allegedly involved in transferring the mortgaged properties to their close relatives through undertakings to delay the recovery proceedings by banks, said sources in the banking industry.
According to the sources, the close relatives of mortgagors turn up with an objection to the recovery proceedings at the stage of auction of the mortgaged properties with a claim that one-third of the mortgaged properties belong to them as per the undertaking signed by the defaulter of the banks’ loans.
In most of the cases, said the sources, spouses of the mortgagors file such applications with a claim that the mortgagor had concealed their undertakings from the bank at the time of mortgaging the property. Interestingly, such claims are often made by the divorcees against their ex-husbands, the sources added.
However, most of such claims prove wrong when the claimants are informed that their ex-husbands had prepared undertakings in their favour after mortgaging the property with banks against hefty loans.
According to the sources, these mortgagors commit a fraud not only with banks but also their spouses, particularly the ex-ones, against the loans obtained from banks. The banking laws experts have pointed out that mortgage is transfer of an interest in specific immovable property for the purposes of securing the payment of money advanced or to be advanced by way of loan or financing, an existing or future debt or the performance of an engagement which may give rise to a pecuniary liability. Once the mortgage is validly created against a specific immovable property stands transferred to the mortgagee. Upon creation of mortgage, the charge travels with the property and not with the person. Thus, if a mortgagor manages to part with the property or confers further interest on third party then the buyer or the third party will step into the shoes of mortgagor and he cannot claim any better title or rights in the property or any interest free from the charge of mortgage.
Copyright Business Recorder, 2023