TaxRefit
[ THIRD-PARTY DISPLAY ADVERTISEMENT SLOT — SPONSORED LEGAL/TAX SERVICES EXCLUDED ]
Loans / Home loans, loan against property and mortgage law
Topic 03 of 19

Home loans, loan against property and mortgage law

Law as on 2026-10-29 Next review 2027-04-29 Applies to banks · HFCs · NBFCs · all REs

Borrowing against real estate changes the balance of legal power between lender and borrower. Unlike personal loans where lenders must secure a civil court decree to attach property, a loan secured by an immovable mortgage allows banks, housing finance companies (HFCs), and notified NBFCs to invoke the SARFAESI Act, 2002. This enables them to assume symbolic possession, take physical control through the District Magistrate under Section 14, and auction the property without filing a civil lawsuit.

At the same time, mortgagors have strong statutory rights under the Transfer of Property Act, 1882, the Real Estate (Regulation and Development) Act, 2016 (RERA), and binding Supreme Court precedents. A lender cannot sell a mortgaged house without a 30-day individual notice, cannot conduct secret auctions below fair market value, and must return all original title deeds within 30 days of full repayment or pay ₹5,000 per day in statutory compensation. This section covers mortgage creation, title scrutiny, builder disputes, CERSAI priority, and auction defence.

What this topic covers

01 Home loans, under-construction projects, and builder disputes A home loan is a secured loan granted to purchase, construct, or renovate a residential dwelling. When financing an under-constru… Read → 02 Joint property, co-owners, and deceased borrower mortgages When a property is co-owned by spouses, siblings, or business partners, all co-owners must sign the mortgage deed as co-borrowers… Read → 03 Loan Against Property (LAP): rules, LTV limits, and tax treatment A Loan Against Property (LAP) is a secured borrowing where you mortgage a clear-titled residential, commercial, or industrial pro… Read → 04 Loans against shares, fixed deposits, and life insurance policies Loans against liquid financial assets provide quick liquidity without liquidating your investments. When borrowing against a bank… Read → 05 SARFAESI mortgage enforcement, auction rules, and borrower rights If you default on a mortgage, a bank or housing finance company does not need to file a civil lawsuit to seize your property. Und… Read → 06 Release of original title deeds on loan closure: RBI 30-day rule and ₹5,000/day compensation When you pay off your home loan or property-backed credit facility in full, the bank or NBFC is legally obligated to return all y… Read → 07 Security registration: CERSAI, ROC charges, and priority of debt In India, creating a mortgage on paper is not enough to secure full priority over an asset. Under Chapter IV-A of the SARFAESI Ac… Read → 08 Stamp duty and registration on mortgages: state rules and legal traps Stamp duty and registration charges on property mortgages are governed strictly by state law under the Indian Constitution, not b… Read → 09 Types of mortgages under Indian law: equitable vs registered mortgages A mortgage is the transfer of an interest in specific immovable property to secure the payment of money advanced as a loan under … Read →

Sources

  1. India Code, Transfer of Property Act, 1882 (Act No. 4 of 1882), indiacode.nic.in, accessed 29 October 2026.
  2. India Code, SARFAESI Act, 2002 (Act No. 54 of 2002), indiacode.nic.in, accessed 29 October 2026.
  3. Supreme Court of India, Mathew Varghese v. M. Amritha Kumar & Ors., (2014) 5 SCC 610, sci.gov.in, accessed 29 October 2026.