Can I purchase a foreclosed property?

Last updated on Jun 7, 2022

When the mortgage borrower is unable or unwilling to pay their equated monthly instalments (EMIs) under the terms of the loan three times consecutively, the lender has a right to acquire that property and either sell or lease it out(( Such foreclosed properties are auctioned off by the lenders and a ‘reserve price’ is set i.e., the minimum amount the lender will accept as a winning bid for the property during an auction. Foreclosed properties are generally expected to be auctioned off at rates lower than their true market values. However, there are often concerns about the quality of such properties as the defaulters are often financially weakened, which would mean that the due repairs and general maintenance of the property are not undertaken regularly. While this is not the standard, it is important to conduct the requisite due diligence about the location, encumbrances and conditions of such property before investing.

Auctions of foreclosed properties can take place through offline or online modes, depending upon the Bank (lender). For an offline auction, prospective buyers should submit their bids with the requisite documents to the Bank before the date of the auction; and for the online mode, the buyers are expected to submit the requisite documents along with the bids online on the day of the auction itself((

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.

As you found this post useful...

Follow us on social media!

We are sorry that this post was not useful for you!

Let us improve this post!

Tell us how we can improve this post?

Leave a Reply

Your email address will not be published. Required fields are marked *

Have a question you want to ask our legal experts?

Related Resources

Who do you complain to if there has been an issue related to buying or selling property?

You can approach the court to raise disputes over land and property for various reasons including claim on ownership etc

Types of Consumer Complaints

Complaints may be filed regarding e-services, misleading advertisements, restrictive trade practices, spurious/defective goods, food etc.

What is a Residence Order under Domestic Violence law?

If you are being thrown out of your shared household (house) by your harasser, the Court can issue a residence order in such a case.
Crimes and Violence

What should I consider when I am buying a house or land?

Two aspects to consider when buying a land or house, is knowing whether price of house is fair and dispute free ownership.

Can I get a bank loan to buy a property using the same property as the collateral?

Yes. You can get a loan from the bank to purchase an immovable property by using the same property as the collateral/security.

How can NRIs and PIOs sell property?

NRIs and PIOs can sell property in India in accordance with RBI's Master Circular. It mandates rules to be followed by NRIs/PIOs in selling.