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Home Best Practices India Increase in property mortgage by banks to recover home loan default

Increase in property mortgage by banks to recover home loan default

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Banks have become increasingly vigilant over non -payment of loans and are sending possession notices even for dues as low as Rs 1.5-2 lakh.
 
“This is because of the worrisome increase in the non-performing assets and the Reserve Bank of India's constant goading to keep NPAs under manageable limit,” a top official of Canara Bank said.
 
According to Mr B. A. Prabhakar, Chairman and Managing Director, Andhra Bank, the Sarfaesi Act has proved to be a “very effective instrument” for recovery.
 
A considerable amount has been recovered using Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (Sarfaesi) 2002. 
 
“Some customers, though few, respond to possession and auction notices triggering some settlements and restructuring,” said Mr Krishna Kumar, Managing Director, State Bank of India.
 
Mr Shiv Kumar, Managing Director, State of Bikaner and Jaipur, said deployment of the Sarfaesi Act was one of the last but effective recovery tools for banks. 

 

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