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FORECLOSURE IN HOUSING FINANCE AND LEGAL DOCUMENTATION

FORECLOSURE IN HOUSING FINANCE AND LEGAL DOCUMENTATION. Housing Finance: Housing finance is to provide funds which home-buyers need to purchase their homes. Foreclosure:

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FORECLOSURE IN HOUSING FINANCE AND LEGAL DOCUMENTATION

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  1. FORECLOSURE IN HOUSING FINANCE AND LEGAL DOCUMENTATION

  2. Housing Finance: Housing finance is to provide funds which home-buyers need to purchase their homes. Foreclosure: Is the legal process by which a mortgage lender (mortgagee), or other lien holder obtains a termination of a mortgage borrower (mortgagor `s) equitable right of redemption, either by court order or by operation of law after following a specific statutory procedure.

  3. TYPES OF FORECLOSURE 1) Foreclosure by judicial sale: Foreclosure by judicial sale more commonly known as judicial foreclosure means the sale of mortgage property under the supervision of court with the proceeds going first to satisfy the mortgage, the other lien holders and finally the mortgagor/borrower if any proceeds are left. 2) Foreclosure by Power of Sale: Foreclosure by power of sale also known as non-judicial foreclosure in which the power of sale clause is included in the mortgage deed and this process involves the sale of the property by the mortgage holder without court supervision. 3) Strict Foreclosure: Although it is not very common but as a kind of foreclosure, I would like to define what the strict foreclosure means. In strict foreclosure suit is brought by the mortgagee and if successful court orders the defaulter mortgagor to pay the mortgagee within a specified period of time and if the mortgagor fails to do so the mortgage holder gains the title to the property with no obligation to sell it.

  4. LAW RELATING TO THE FORECLOSURE In Pakistan the right to foreclosure is defined under the head of rights and liabilities of mortgagee. The relevant section 77 of Transfer of Property Act 1882 says that the mortgagee has at any time after the mortgage money has become due to him and before a decree has been made for the redemption of the mortgaged property or the mortgage money has been paid or deposited, a right to obtain from the court a decree, that the mortgagor shall be absolutely debarred of his right to redeem the property or a decree that the property be sold, such a suit is called as a suit for foreclosure. Section 67 to 77 deal with the right and liabilities of the mortgagee just as section 60 to 66 have dealt with the rights & liabilities of the mortgagor. The mortgagees remedies by suit are : - 1) On the covenant 2) for sale 3) for foreclosure

  5. MORTGAGE: Mortgage is a security interest in real property, held by lender as a security for debit. To be more specific, It is a transfer of interest in land from the owner, to the mortgage lender on the condition that this interest will be returned to the owner when the terms of mortgage had been satisfied or performed, as such, is a security for the loan that the lender makes to the borrower. The transferor is called “mortgager”, a transferee is called a “mortgage”, the principle money loan is called mortgage money”, and the instrument by which the transfer is effected is called “mortgage deed”. Kinds of Mortgage: There are six kinds of mortgage a) Simple Mortgage b) Mortgage by Conditional Sale c) Usufructuary mortgage d) English Mortgage f) Equitable mortgage g) Anomalous mortgage

  6. a) Simple Mortgage: A simple mortgage is a mortgage where without delivering position of the mortgage property, the mortgagor binds himself personally to pay the mortgage money and agrees expressly or impliedly that in the event of his failure to pay, the mortgagee shall have the right to cause the mortgage property to be sold and the proceeds of the sale to be applied. The period of limitation for filing of suit is twelve years from the date when the money suit becomes due. Registration of mortgage deed is required to make it enforceable under law. b) Mortgage by conditional sale: Is a mortgage where the mortgagor sells the property on the condition. That on default of payment of mortgage money on a certain date, sale shall become absolute. or on the condition that on such payment being made the sale shall become void. Or on condition that on such payment being made the buyer/mortgagee shall transfer the property to seller. Registration required.

  7. c) Usufractuary Mortgage: In this kind of mortgage, the mortgagee is placed in possession and has a right to enjoy the rents and profit until the debt is paid. It is not necessary that mortgagee shall take physical possession and the mortgagor shall continue in possession as lessee of the mortgagee or he may direct the tenants to pay rent to the mortgagee. The title deeds remain with the owner/mortgager. The mortgagee retains possession until the mortgagee money is paid. Registration required. d) English Mortgage: Where the mortgagor binds himself to repay the mortgage money on a certain date and transfer the mortgage property to the mortgagee but subject to a condition that he will retransfer it to a mortgagor upon payment of the mortgage money as agreed .Registration required. e) Equitable Mortgage: Equitable mortgage can be created by deposit of title deed to a creditor with the intent to create a security.In such motgage,the mortgager delivers the tittle documents of the property to the mortgagee with the intention to create security thereon. f) Anomalous mortgage: Mortgage which consist of different types of mortgages. Registration required.

  8. SECTION 9, FIO 2001. (1) Where the customer or financial institution commits a default in fulfillment of any obligation the customer or financial institution as the case may be institute a suit in Banking Court having jurisdiction by presenting plaint which shall be verified on oath. Necessary documents to be required 1. Statement of account duly verified in accordance with bankers books of Evidence Act 1891 (For Financial Institution). 2. Finance Agreement. {alongwith other charge documents} 3. Personal Guarantee 4. Mortgage Deed {alongwith other security documents} Necessary information u/s. 9(3) to be incorporated The plaint must contain para with respect to following: - a) The amount of finance availed by the defendant. b) The amount paid by the defendant. c) The amount of finance and other amounts payable by the defendant.

  9. SECTION 10(2) FIO 2001, LEAVE TO DEFEND: The defendant has to file application for leave to defend within 30 days of the date of first service. Necessary information to be incorporated. The application for leave to defend shall be in form of written statement and shall contain summary of the substantial question of law as well as fact in respect. The amount of finance availed by the defendant. The amount of finance and other amounts payable by defendants to financial institution upto the date of institution of the suit. The amount if any which the defendant disputes as payable to the financial institutions.

  10. QUESTION AND ANSWER SESSION 15 MINUTES

  11. DECREE Where application for leave to defend is rejected, the court shall for with proceed to pass judgment and decree and where it is accepted the court shall treat the application as statement and shall frame issues for recording evidence and dispose of the suit.

  12. SECTION 11 OF FIO 2001 Interim Decree: The court may pass decree (interim) where is of opinion that: - The dispute between the parties does not extend to the whole of the claim. Where the part of claim is either undisputed or is clearly due. Where the dispute is mainly limited to a part of the principal amount of the finance. Section 12 of FIO 2001, Power to set aside decree. Where final decree u/s. 10 is passed, the aggrieved party may file appeal within 21 days from the date of decree. Section 14 of FIO 2011 Decree is suits relating to Mortgage. Where suit filed by financial institution is for enforcement of a mortgage of immoveable property the court shall pass an interim or final decree for foreclosure or sale.

  13. Section 15 FIO 2001 Sale of Mortgage Property without intervention of court. Under section 15(2), the financial institution can send following notices in case of default in payment by customer, demanding payment of the mortgage money and incase of failure to sell the mortgage property. 1. First Notice for 14 days. 2. Second Notice for 14 days. 3. If continuous to default in payment than final notice to be served for 30 days.

  14. FORMAT OF NOTICES 1. FIRST DEMAND NOTICE Ref: ______________ Dated:____________ MR. ___________________ ______________________ THROUGH COURIER Subject:First Demand Notice for the Payment of Mortgage Money under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001. Dear Sir/Madam, We have been instructed by our client i.e The Bank Of Punjab, having its Head Office, at Lahore and a Branch amongst others known as _________ Branch, (hereinafter referred to as ‘ The Bank’) hereby serve upon you notice under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for demanding the mortgaged money. At your guarantee/mortgage, the Bank sanctioned a running finance facility (hereinafter referred to as “TheFinance”) to M/s. __________________, through its Proprietor namely Mr. _______________, by way of agreement for financing dated ___________, having its office at _____________________, (hereinafter referred to as the “Customer’). In consideration and in pursuance of the above, you with intent to create mortgage had executed Memorandum of Deposit of Title Deed and also Registered Mortgage Deed in favor of the Bank, with regard to the Property/Residential House, measuring _______________________________________, to secure the amounts due towards the Customer. The above Customer availed the said finance facility, however, failed to repay the due amount to the Bank. The Customer was reminded time and again to discharge its/their outstanding financial obligations but all efforts in this regard failed and the Customer ignored/neglected to discharge and liquidate the financial obligation(s) under the agreement, commitments, promises, and undertakings executed by the Customer in this behalf. Contd…P/2

  15. -2- That Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, empowers the Bank to sell the mortgaged property without the intervention of the Court. In pursuance thereof, you are called upon to pay the due amount of Rs._____________/- (Rupees ___________________only) as on ____________ along with all costs, charges and mark-up within 14 days from the receipt of this notice, failing which, the Bank shall proceed in accordance with Section 15 of the Ordinance to sell mortgaged property by public auction and recover its outstanding amounts. Please be informed that by virtue of Section 15(3), upon service of this First Notice, all the powers of the Mortgagor and benefits and/or profits from mortgaged property shall transferred to BOP, until this notice is withdrawn. Since, the Customer has defaulted in discharge of his liabilities and has not given positive response and willfully neglected/refused to pay the amounts which continues to remain outstanding, hence this notice. Thatthe Bank hereby call upon you, to pay the outstanding amount ofRs.__________/- (Rupees________________________________________ only) as on _______________ along with all PRESENT AND FUTURE costs, charges and mark-up within Fourteen (14) days from the date of receipt of this notice, failing which the Bank shall be constrained to initiate the proceedings under Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for sale of mortgaged property at your own risk and costs. A copy of this notice is being retained in our office for future reference and record. Yours truly, Sd/- ATTORNEY-AT-LAW Copy to: The Manager, _______________________ Branch. The Head, SAM (Commercial) Division. ATTORNEY-AT-LAW

  16. 2. SECOND DEMAND NOTICE Ref: ______________ Dated:____________ MR. ___________________ ______________________ THROUGH COURIER Subject:Second Demand Notice for the Payment of Mortgage Money under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001. Dear Sir/Madam, Reference Notice Under section 15 of the Financial Institutions (Recovery of Finances) Ordinance dated 16 March 2010, served upon you. We have been instructed by our client i.e The Bank Of Punjab, having its Head Office at BOP Tower, 10-B, Block E-II, Main Boulevard, Gulberg-III, Lahore and a branch amongst others known as __________, (hereinafter referred to as (‘The Bank’) hereby serve upon you second notice under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for demanding the mortgaged money. At your guarantee/mortgage, the Bank sanctioned a running finance facility (hereinafter referred to as “TheFinance”) to M/s. __________________, through its Proprietor namely Mr. _________________, by way of agreement for financing dated ________________, having its office at ___________________________________________, (hereinafter referred to as the “Customer’). In consideration and in pursuance of the above, you with intent to create mortgage had executed Memorandum of Deposit of Title Deed and also Registered Mortgage Deed in favor of the Bank, with regard to the Property/Residential House, measuring _______________________________________, to secure the amounts due towards the Customer. The above Customer availed the said finance facility, however, failed to repay the due amount to the Bank. The Customer was reminded time and again to discharge its/their outstanding financial obligations but all efforts in this regard failed and the Customer ignored/neglected to discharge and liquidate the financial obligation(s) under the agreement, commitments, promises, and undertakings executed by the Customer in this behalf. Contd..P/2

  17. -2- That Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, empowers the Bank to sell the mortgaged property without the intervention of the Court. In pursuance thereof, you are called upon to pay the due amount of Rs.___________/- (Rupees ______________________only) as on 29.03.2010 along with all costs, charges and mark-up within 14 days from the receipt of this notice, failing which, the Bank shall proceed in accordance with Section 15 of the Ordinance to sell mortgaged property by public auction and recover its outstanding amounts. Please be informed that by virtue of Section 15(3), upon service of this Second Notice, all the powers of the Mortgagor and benefits and/or profits from mortgaged property shall be transferred to BOP, until this notice is withdrawn. Since, the Customer has defaulted in discharge of his liabilities and has not given positive response and willfully neglected/refused to pay the amounts which continues to remain outstanding, hence this notice. Thatthe Bank hereby once again call upon you, to pay the outstanding amount of Rs.__________________/- (Rupees _________________________________only) as on __________ along with all PRESENT AND FUTURE costs, charges and mark-up within Fourteen (14) days from the date of receipt of this notice, failing which the Bank shall be constrained to initiate the proceedings under Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for sale of mortgaged property at your own risk and costs. A copy of this notice is being retained in our office for future reference and record. Yours truly, Sd/- ATTORNEY-AT-LAW Copy to: The Manager, _______________________ Branch. The Head, SAM (Commercial) Division. ATTORNEY-AT-LAW

  18. 3. FINAL DEMAND NOTICE Ref: ______________ Dated:____________ MR. ___________________ ______________________ THROUGH COURIER Subject:Final Demand Notice for the Payment of Mortgage Money under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001. Dear Sir/Madam, Reference Notice Under section 15 of the Financial Institutions (Recovery of Finances) Ordinance dated 16 March 2010, served upon you. We have been instructed by our client i.e The Bank Of Punjab, having its Head Office at BOP Tower, 10-B, Block E-II, Main Boulevard, Gulberg-III, Lahore and a branch amongst others known as ____________ Branch, (hereinafter referred to as (‘The Bank’) hereby serve upon you Final Notice under Section 15(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for demanding the mortgaged money. At your guarantee/mortgage, the Bank sanctioned a running finance facility (hereinafter referred to as “TheFinance”) to M/s. ________________, through its Proprietor namely Mr. ____________, by way of agreement for financing dated ________________, having its office at __________________, (hereinafter referred to as the “Customer’). In consideration and in pursuance of the above, you with intent to create mortgage had executed Memorandum of Deposit of Title Deed and also Registered Mortgage Deed in favor of the Bank, with regard to the Property/Residential House, measuring _______________________________________, to secure the amounts due towards the Customer. The above Customer availed the said finance facility, however, failed to repay the due amount to the Bank. The Customer was reminded time and again to discharge its/their outstanding financial obligations but all efforts in this regard failed and the Customer ignored/neglected to discharge and liquidate the financial obligation(s) under the agreement, commitments, promises, and undertakings executed by the Customer in this behalf. Contd…P/2

  19. -2- That Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, empowers the Bank to sell the mortgaged property without the intervention of the Court. In pursuance thereof, you are called upon to pay the due amount of Rs.___________/- (Rupees ______________________only) as on _____________ along with all costs, charges and mark-up within 30 days from the receipt of this final notice, failing which, the Bank shall proceed in accordance with Section 15 of the Ordinance to sell mortgaged property by public auction and recover its outstanding amounts. Please be informed that by virtue of Section 15(3), upon service of this Final Notice, all the powers of the Mortgagor and benefits and/or profits from mortgaged property shall be transferred to BOP, until this notice is withdrawn. Since, the Customer has defaulted in discharge of his liabilities and has not given positive response and willfully neglected/refused to pay the amounts which continues to remain outstanding, hence this notice. Thatthe Bank hereby once again call upon you, to pay the outstanding amount of Rs.____________/- (Rupees ______________________________ only) as on ____________ along with all PRESENT AND FUTURE costs, charges and mark-up within Thirty (30) days from the date of receipt of this final notice, failing which the Bank shall be constrained to initiate the proceedings under Section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for sale of mortgaged property at your own risk and costs. A copy of this notice is being retained in our office for future reference and record. Yours truly, Sd/- ATTORNEY-AT-LAW Copy to: The Manager, _______________________ Branch. The Head, SAM (Commercial) Division. ATTORNEY-AT-LAW

  20. HOUSE BUILDING LOAN (FOR CUSTOMER) Ref: __________ Dated:__________ MR. _________________ S/O ____________________, R/O ____________________, THROUGH REGISTERED A/D Subject: LEGAL NOTICE FOR THE PAYMENT OF OUTSTANDING DUES OF THE BANK Dear Sir, We have been instructed by The Bank of Punjab, _____________ Branch, __________ (“the Bank”) to serve you with the following legal notice: 1. That on _________ you were allowed financial accommodation by way of House Loan Facility for an amount of Rs:____________/- by the Bank alongwith mark-up at the agreed rate. 2. That the Facility was disbursed to you for a repayment period of ______ year from the date of disbursement. 3. That in consideration of the above said financial accommodation, inter alia the various charge/security documents were executed i. e. Agreement for Financing, Letter of installment, Demand Promissory Note, Letter of continuity, Registered Mortgage Deed, Memorandum of Deposit Title Deed etc and further you secured the facility by issuing three Cheques as security to the Bank. 4. That under the terms of the memorandum of deposit of title deed/mortgage deed, the mortgage property can be sold even without intervention of the Court under the provision of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for the repayment of the dues outstanding against and payable by you. 5. As on ____________ an amount of Rs.________________/- is outstanding against you towards the facility availed by you from the Bank. We, therefore, under the instructions of the Bank of Punjab serve you with this legal notice to pay to the Bank, the outstanding dues to the tune of Rs.__________/- as on _________ within 07 days from the receipt of this notice. In case, you fail to pay the aforementioned liability within the stipulated period, we have clear instructions to initiate legal proceedings against you, for the recovery and realization of Bank’s amount by enforcing all or any of the remedies available to the Bank, including the attachment of movable and immovable properties other then the mortgaged property at your risk and cost. A copy of this notice is being retained in our office for future reference and record. Yours truly, ____________________

  21. Under section 15(3) FIO 2001 After the final notice served all the powers of the mortgagor in mortgage property with regard to recovery of rents and profits shall stand transferred to the financial institution until such notice is withdrawn and it shall be duty of mortgagor to pay all rents and profits and incase of tenancy, the tenant to pay all rents or lease money to financial institution. SALE OF PROPERTY. Section 15(4) FIO 2001. Where mortgagor fails to pay the amount as demanded after final notice has been served and 30 days passed then the financial institution may without intervention of any court sell the mortgage property or any part thereof by public auction and appropriate the proceeds thereof towards total or partial satisfaction of the outstanding mortgage money.

  22. Necessary steps to be taken. Publication in one English Newspaper and one Urdu Newspaper specifying particulars of the mortgage property including name and address of the mortgagor, details of mortgage property, amount of outstanding and reserve price. Send such notices to all persons who to the knowledge of the financial institutions have an interest in the mortgage property as mortgagors.

  23. PUBLIC AUCTION OF MORTGAGED PROPERTY The Bank of Punjab, Cantt Branch, Multan under section 19 sub section 3 of the Financial Institutions (Recovery of Finance) ordinance 2001 that public at large is informed that the bank is to going to auction the mortgaged property (incase of decree then in connection with Recovery Suit No______/2011 titled BOP Vs.________ which was decreed in favour of the Bank, by the court of Mr._____________ Judge Banking Court NO.__, Lahore on ____________ in favour of Bank/decree holder and ordered dated __________ is going to auction the following mortgaged property by itself) for the recovery of decretal amount. Schedule of Public auction of property is as under: Decretal Amount: Rs._________________ along with cost of suit and cost of funds from the expiry date till the final realization of decretal amount. Place of auction: At the spot. Date & Time of Auction. 10:00 AM dated ____________ Reserved Price: Rs._____________ Detail of Property: Measuring __Kanals and __ Marlas Khewat No.______ Khatoni No.________ Khasra No.__________, Mutation No._____ situated at __________________________________ Terms & Conditions: Property will be auctioned on the basis of as and where. Before the auction every bidder shall deposit Rs._______ as cash/pay order/bank draft in the Bank. THE BANK official shall return the earnest money paid to non successful bidder of the auction. Auction will be confirmed in favour of highest bidder. Successful bidder shall deposit 25% of the amount at the spot by cash to the auctioneers, otherwise property will be re-auctioned and earnest money of that bidder will be forfeited. Successful bidder shall deposit remaining 75% auction amount within 15 days to the Bank otherwise his already deposited 25% deposited amount will be forfeited. That the successful bidder will be responsible for all expenses regarding the transfer of property. The sale certificate will be issued after the final approval of Bank authority. That THE BANK shall have right to cancel or postpone the auction proceedings, to accept or reject any offer and in changing of terms and conditions of auction. PUBLICATIONER AUCTIONEER Mr._________________ Mr.___________________ Manager, Advocate High Court, The Bank, ___________ Branch Ph:______________

  24. PUBLIC AUCTION NOTICE Mr.__________S/O_____________, Ref No. 146/ALA//2010 Caste _________R/O___________, Date: 15/10/2010 Mouza__________, Tehsil _______, District ______. Subject: - Public Auction Notice for the recovery of outstanding Amount Rs: 2,84,448/= along with cost of suit & cost of fund The undersigned have been appointed as an Advocate on behalf of The Bank , Cantt Branch, Multan and instructed me to serve upon the public auction notice to you with reference to above titled subject under Financial Institutions (Recovery of Finance) ordinance 2001 U/S 19(3) with effect to so as:- 1. That you have availed loan/finance facility & mortgaged agri land measuring 42K-0M, lying in Khewat No.84, Khatooni No. 456-469 measuring 38K-0M & Khewat No. 91 measuring 04K-0M situated at Mouza Jhok Laskar Pur Tehsil Sadar, Distt. Multan vide Mutation No. 3188 dated 31-10-2005 for Kissan Dost Agriculture Finance Scheme & Judge Banking Court No.3 Multan passed Decree on 17-02-2010 & permission to auction the mortgaged property order dated 08-04-2010. 2. That the undersigned completed auction proceedings according to law & published proclamation in the daily Newspapers. 3. That the public auction will be conducted at spot on 26-11-2010, Friday at 10:00a.m. 4. That you are hereby called upon to pay the same within 07 days from service of this notice, failing which public auction proceeding would be taken further in according to law for the recovery of the outstanding amount. The copy of this legal notice retained with me, please keep the same with you to produce by you for evidence in the court of law. Yours truly, Advocate High Court District Courts, ______ Cell No.-------------- C.C. To:- The Manager, The Bank , _______Branch, ________, for kind information.

  25. Sec. 15(5) FIO 2001 Financial institution shall be entitled in its discretion to participate in the public auction and to purchase the mortgage property. Sec. 15(6) FIO 2001 The court may on application put the financial institution or purchaser in possession of mortgaged property sought to be sold or sought to be purchased by the financial institution subject to expiry of bonafide lease (if on rent) or on payment of such compensation as may be agreed between parties or determined by court. Sec. 15(7) FIO 2001 Sale Deed of sold property can be executed by financial institution in capacity of duly authorized attorney of mortgagor. Sec. 15(10) FIO 2001 Financial Institution has to file proper accounts of the sale proceeds in court within 30 days of the sale. Sec. 15(12) FIO 2001 Neither the Banking Court nor High Court shall grant injunction, restraining the sale or proposed sale of mortgage property. a) It is satisfied no mortgage has been created. b) All moneys secured by mortgage of mortgaged property have been paid. c) The mortgagor or objector deposits in court cash the outstanding amount.

  26. Sec. 16 FIO 2001 Attachment before Judgment: Application can be filed under this section for attachment of mortgage property and get restraining under of for transferring, alienating, parting with possession or disposing or dealing with property in any manner, Attach such property, Transfer possession of such property to the financial institution and appoint one or more receivers of such property. Sec. 19 FIO 2001 Upon pronouncement of judgment and decree by a banking Court, the suit shall automatically stand converted into execution proceedings without the need to file fresh application and no fresh notice need to be sent to judgment debtor in this regard. Particulars of mortgage property and other assets of the judgment debtor has to be be filed for consideration of court and the proceedings be heard on expiry of 30 days after the pronouncement of judgment and decree. Sec. 19 (3) FIO 2001 In cases of mortgaged property, the financial institution may sell or cause the same to be sold with or without intervention of court either by public auction or by initiating sealed tenders and appropriate proceeds.

  27. Sec. 20 (c) FIO 2001 If customer subsequent to creation of mortgage in favour of a financial institution dishonestly alienates or parts with the possession of the mortgage property without permission from bank/financial institution and subsequent to passing of decree under section 10 or 11, sells, transfers or otherwise alienate can be punished for term which may extend to 3 years and shall also be liable for fine which may extend to value of property or security decreed or market value which is higher. Sec. 23 FIO 2001 After publication of summons under subsection (5) of section 9, no customer shall without prior written permission of the court transfer alienate, encumber, remove or part with possession of any of his asset or property furnished to the financial institution as security by way of mortgage or otherwise pending final decision. 23(2) After pronouncement of judgment and decreed by Banking Court, including an interim decree u/s. 11 no judgment debtor shall without prior permission of the court transfer, alienate part with possession of any asset or property and any such transfer, alienation or encumbrance in violation of this sub section shall be void and have no legal effect. 23 (3) Provision of this section shall also apply to person who has furnished any security on behalf of customer.

  28. QUESTION AND ANSWER SESSION 15 MINUTES

  29. PART-II LEGAL DOCUMENTATION FOR HOUSING FINANCE

  30. There are two (2) types of set of documents required legally to be executed for obtaining the house finance. 1. Charge documents 2. Security documents. 1. CHARGE DOCUMENTS. a) Agreement for financing. b) Promissory Note c) Personal Guarantee d) Letter of installments e) Debit authority. f) Undertaking to comply with the SBP rules & regulations g) Letter of continuity. h) Mortgage Deed i) MODT.

  31. 2. SECURITY DOCUMENTS. Urban property: a) Property out side the Revenue Record: i) Sale Deed/Gift Deed/Surrender Deed/Transfer Deed/Permanent Transfer Deed (PTD). ii) Non-Encumbrance Certificate from concerned Sub-Registrar. iii) Latest Form P.T.1 from Excise & Taxation Department/Property Tax Department. iv) Sale Deed(s) of predecessor of the owner(s) of property, if any. v) Approved site plan. vi) Utility bills. vii) Fard/Intiqal, where available. b) Property falls in Revenue Record: i) Sale Deed/Gift Deed/Surrender Deed/Transfer Deed/Permanent Transfer Deed (PTD). ii) Non-Encumbrance Certificate from concerned Sub-Registrar. iii) Certified Copy of Mutation. iv) Latest Fard Jamanbandi issued by concerned Patwari and countersigned by Tehsildar/Naib Tehsildar. v) Copy of Tatima /Akas-e-Shajra identifies the property. vi) Latest Form P.T.1 from Excise & Taxation Department/Property Tax Department. vii) Sale Deed(s) of predecessor of the owner(s) of property, if any. viii) Approved site plan. ix) Utility bills. x) In case of plot, demarcation of property duly signed by Tehsildar should be obtained.

  32. c) Property/House of Lahore Development Authority. i) Sale Deed/Gift Deed/Surrender Deed/Transfer Deed. ii) Non-Encumbrance Certificate from concerned Sub-Registrar. iii) Transfer Letter issued by LDA. iv) Completion Certificate issued by LDA. v) Latest Form P.T.1 from Excise & Taxation Department/Property Tax Department. vi) Sale Deed of predecessor of the owner(s) of property, if any. vii) Approved site plan. viii) Utility bills. d) Property/Plot of LDA. i) Allotment Letter/Exemption Letter/Transfer Letter issued by LDA. ii) Possession Letter. iii) Lay out Plan. iv) In case of exemption, sale agreement with LDA. v) Receipts of payments. vi) Permission to Mortgage from LDA. vii) In case of transfer of plot, all the documents since first allotment/exemption.

  33. e) Property of Co-Operative Society. i) Allotment Letter/Transfer Letter issued by Society. ii) Possession Letter issued by Society. iii) Lay out Plan of Society. iv) Registration and Bye-laws of Society. v) Receipts of payments. vi) Permission to Mortgage/NOC from Society. vii) Transfer Deed. viii) In case of constructed house, approved site plan + completion certificate. ix) Utility bills. x) Membership Certificate f) Property of MEO/Cantonment. i) Lease Deed of original lessee. ii) Sale Deed. iii) General Land Record (GLR). iv) Tax NOC from Cantonment Board. v) Non-Encumbrance Certificate from concerned Sub-Registrar. vi) Approved site plan. vii) Permission to Mortgage from MEO.

  34. g) Property of DHA. i) Allotment Letter/Transfer Letter. ii) Possession Letter. iii) Receipts of payments. iv) Permission to Mortgage. v) Membership Certificate h) Agricultural land. i) Sale Deed/Gift Deed/Surrender Deed/Transfer Deed. ii) Non-Encumbrance Certificate. iii) Certified copy of Mutation. iv) Latest Fard Jamanbandi issued by Patwari countersigned by Tehsildar/Naib Tehsildar. v) Certified copy of Akas-e-Masavi. vi) Akas-e-Shajra identifies the property. vii) Khasra Gardawari.

  35. QUESTION AND ANSWER SESSION & THANKYOU

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