The Sarfaesi Act is a groundbreaking law that has had a profound impact on mortgage lending in India. Prior to the enactment of the Sarfaesi Act, mortgage lenders were largely reliant on the courts to enforce their rights in the event of a default. This process was often slow and cumbersome, and it was not unusual for mortgage lenders to wait years for a judgment. The Sarfaesi Act changed all that by creating a specialised tribunal to handle mortgage-related disputes. The tribunal has the power to issue prompt and binding decisions, which has helped to speed up the recovery process for mortgage lenders. In addition, the Sarfaesi Act has also helped to reduce the level of non-performing assets (NPAs) in the Indian banking
Enforcement of SARFAESI Act
Helping Secured Creditors in Enforcing SARFAESI Act with the Help of Skilful Legal Team
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Introduction To SARFAESI Act
The mortgage lending industry has been hit hard in recent years by the rising number of non-performing assets (NPAs). In order to protect their interests, secured creditors are increasingly turning to the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act) to recover their loans. However, the process of enforcing the SARFAESI Act can be complex and time-consuming. Fortunately, we at Kenstone Capital have skilled legal teams that specialize in helping secured creditors to enforce the Act. These teams have the experience and expertise necessary to navigate the complexities of the SARFAESI Act, and they can help to ensure that secured creditors receive the maximum possible recovery on their loans.
With a skillful legal team specialized in enforcing the SARFAESI Act, allows us to help you
“Our SARFAESI enforcement agents can help you recover the money you are owed!”
Why use our SARFAESI enforcement service?
What Is Non-Performing Asset (NPA)?
A mortgage lending institution typically classifies a mortgage loan as non-performing when the borrower has not made a mortgage payment for at least 90 days. At that point, the mortgage is considered delinquent. Once a mortgage loan becomes delinquent, it is then classified as non-performing. In most cases, the mortgage lender will begin foreclose proceedings on a home once it has been classified as an NPA.
NPAs can have a serious negative impact on a mortgage lending institution’s financial stability and solvency. As such, institutions typically take aggressive action to minimize their exposure to NPAs. One common strategy is to sell NPAs to third-party investors at a discount. This allows the mortgage lender to recoup some of its dues.
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Significance Of The SARFAESI Act
What Is Covered Under SARFAESI ACT?
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) was enacted to enable financial institutions to resolve the problem ofNon-Performing Assets (NPA) by securitisation of mortgage lending transactions. The objective of the Act is to promote the orderly growth of the mortgage market in India by providing a mechanism for expeditious enforcement of security interest.
The SARFAESI Act covers all transactions pertaining to mortgage lending, including home loans, auto loans, education loans, personal loans, etc. It applies to both public sector banks and private sector banks, as well asNBFCs that are registered with RBI.
What Are Asset Reconstruction Companies?
In simple terms, an asset reconstruction company (ARC) is an entity that buys non-performing assets (NPAs) from banks and financial institutions. The main objective of an ARC is to revive such NPAs and generate income from them. This is done by either selling the assets or by workout plans such as loan restructuring, debt consolidation, etc.
Mortgage lending is one of the key areas where ARCs are active. A mortgage loan becomes an NPA when the borrower defaults on repayments for a continuous period of 90 days. In such cases, the ARC steps in and takes over the loan from the lender. It then tries to recover the dues by working out a suitable repayment plan with the borrower.
Salient Features Of SARFAESI Act
The below mentioned points are the salient features of the Act, which tries to:
- Securitise the financial assets (securitisation)
- Enforce Security interest by the secured creditor (without court intervention)
- Reconstruct the financial assets
- Establish Central Registry
How Kenstone Capital Can Serve You In Enforcing SARFAESI Act?
Kenstone Capital has the expertise and resources to take care of your entire loan recovery process, from start-to-finish. We can help you recover non performing assets at record pace with our dedicated team who are experts in enforcing SARFAESI Act or The Security Interest Enforcement Rules 2002.
We also have access to legal proceedings involved in securitisation through state of the art technologies which helps us expedite the process and minimise the turnaround time.
Benefits of engaging Kenstone Capital:
- Highly qualified and experienced lawyers.
- Maximum efficiency through process automation
- End to end enforcement solution
- Highly experienced and trained physical repossession team
- DRA certified and RBI guidelines compliant
- Highest standards of professionalism and ethical business practices
- Industrial grade data security