What Security does one provide against the loan amount to be borrowed?
Generally, by way of deposit of title deeds and/or such other collateral security as may be necessary. Additionally, if the property is under construction interim security may be required. Collateral or interim security could be assigned to the Bank/ FI where the surrender value is at least equal to the loan amount. It could be other forms of guarantees or pledge of shares acceptable by the bank / FI. One should ensure that there is no existing mortgage or loan or litigation which can affect the title of the property. The title should be clear, marketable and free from encumbrances.
