Ever thought of buying a property being auctioned by banks? From time to time, banks put out auction notices for properties that turn into non-performing assets (NPAs) due to non-payment of loans. These properties are usually ready-to-move-in and are typically available at a discount to the current market rates.
Though that might sound attractive, yet there seem to be few takers for these properties. In 2022-23, scheduled commercial banks (SCBs) recovered ₹ 30,864 crore out of ₹ 1.11 lakh crore of NPAs through the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) recovery channel. This is one of the channels, besides lok adalat, debt recovery tribunal (DRT) and insolvency and bankruptcy code (IBC) from where NPAs are recovered. The recovery in 2022-23 was 27.6 per cent compared to 22.5 per cent in the previous financial year, shows the latest data.
So why is the recovery rate poor and why are there few takers for such properties? That’s because the benefits of auction bidding are often overshadowed by the risks and uncertainty involved in the auction process. That’s why, it’s important to know the pain points should you decide to buy an auctioned property.
Lender-Borrower Dispute
One of the issues you may face is the intervention of the borrower whose property is put on auction due to non-payment of dues.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
Gold ETFs And FoFs
While Indians love to invest in physical gold, even mutual funds offer the option, but in paper format.
PLANNING TO BUY CHILD INSURANCE? THINK TWICE
Child insurance plans combine insurance and investment but often offer low returns due to high costs, making a combination of a term insurance cover and mutual fund a better option for securing your child’s higher education needs
How Do You Define Happiness?
Money does buy happiness, but after a while, the appeal fades. We talk about our relationship with money, but, maybe, it’s time to revisit our relationship with happiness
Avoid Crypto As It Is Highly Volatile
I am 22 years old and have recently started working. I want to invest a small portion of money in cryptocurrency. How should I go about it? Does it require a huge capital investment?
Invest Right, Don't Speculate
The lure of high returns and quick gains from equity tips, cryptocurencies, and equity F&O can be enticing. But remember, return of capital is more important than return on capital
The Wedding & Budget: Is Minimalist Trend The Right Knot For You?
Indian weddings are known for their pomp and grandeur, but minimalist weddings are also in vogue now. Dia Mirza was one such celebrity who went for a minimalist wedding. If you also want to keep things minimal on your big day, here’s how to do it
Here's How To Buy An ETF?
Mutual funds are the preferred choice for retail investors. However, they come at a cost and fund management risk, apart from other risks. A smarter alternative is to invest through ETFs.
How Passive Funds Help Diversify
Passive funds provide a simple way to invest in broad markets as well as in specific themes and sectors, making them ideal for an investor's satellite portfolio
The Rise Of Passive Funds
The popularity of passive funds among retail investors has risen post Covid, and fund houses are out with many variations of ETFs and index funds. Does this category present a new opportunity for investors?
Tax Reforms: What's In Store?
The government is working on reforming the existing Income-tax Act, 1961. The impending reforms have raised many questions in the minds of taxpayers. Will the old regime and deductions be done away with? Will it really simplify your life? What's the need for these reforms? We try to answer these and other questions regarding tax reforms