Auctioned properties can be good value, but they carry risks. General legal information only.
Before you bid
- Read the sale notice and the terms of sale carefully, including whether the property is sold “as is where is”.
- Check whether the lender has physical or only symbolic possession. Getting possession from an occupant can take time.
- Ask for the title papers and do an independent search for encumbrances, dues to authorities and pending litigation.
- Check whether any challenge to the enforcement is pending before the Debts Recovery Tribunal, which can affect the sale.
- Visit the property and check its actual condition and use.
Payment
The Security Interest (Enforcement) Rules, 2002 require the successful bidder to pay a first instalment on the day of the sale and the balance within a set period. Missing a deadline can lead to forfeiture. Check the exact terms in the notice.
After the sale
- Obtain the sale certificate and register it as required.
- Pay stamp duty on the sale certificate.
- Plan for possession and for outstanding electricity, water and authority dues.
If the sale is challenged
A borrower can challenge a sale before the DRT. An auction purchaser may be heard in those proceedings. Seek advice before bidding for a property under dispute.
Related: Debt recovery and SARFAESI · All debt recovery guides · Send an enquiry
Important disclaimer: This article is general legal information, not legal advice. It does not create a lawyer-client relationship and is not an advertisement or solicitation under Bar Council of India rules. Verify current statutes, rules and judgments before relying on it.
