We have to ask the lawyers what sort of power is given to the bank under mortgage loan. We know bank can force sell your property if you default payment. But we don't know rights is given to bank to evict the owner at this auction stage.

It can happen that the sales of property could more than enough to cover the bank loan. So the banks cannot 'jump the gun' at this moment.

But business wise, it is beneficial for house to be vacant first or else cannot fetch a good price.

Borrower has given poa to the bank, the bank has sole discretion on the property.

the property is auction on as is where is basis, it will be up to the new owner to deal with occupant.

If bank is given full discretion on the property, then the bank should consider evicting owner who stays there. As it makes business sense.

Banks can still try to recover the shortfall from owner but the banks should know the chances are slim.

If bank is given full discretion on the property, then the bank should consider evicting owner who stays there. As it makes business sense.

Banks can still try to recover the shortfall from owner but the banks should know the chances are slim.

Bank could recover any shortfall from borrower regardless of the situation. why bother to evict occupant? if bank to evict occupant, borrower could come to bank for humanity pledge, which bank managers are reluctant to face.

you are wrong icey

I believe both banker and borrower/owner already made many times, cried til tears dry many round, turning table and use bad languages to one and other many times before the unit is put on auction.

unless borrower just ignore all correspondences from banker, typically if borrowers are runners or based overseas or foreign buyers.

As said previously; if borrower is genuinely in trouble but still has the will and capability to repay, most banks would restructure the facility. bank is not in charity, could only restructure only at most 2 times. if the bank decided to recall the facility i.e auction, it will handle by different department e.g recovery, legal,  which borrower hardly has access to or meet.

At the end of the day, the banks still want to play soft, at the expense of the auction value of the house. We see in the example  given AskarPerang, a difference of 70k ( not concluded yet ).

Bank could recover any shortfall from borrower. Bank has no obligation to maximize value of the property but it is borrower's interest. If borrower doesn't help himself, no one could.

Bank has the right to recover the shortfall but is it going to succeed ? If these people got no place to go and have to still stay put at the auctioning units, I seriously doubt so.

That's the whole basis of the argument. I doubt that the banks can successfully recover the shortfall.

If borrower couldn't cough out enough will end up in bankruptcy. If borrower ended up in bankruptcy, it has zero impact on bank's balance sheet as provision is already provided when borrower is in default/npl.

After the property is auctioned/sold, it is the new owner's interest and efforts to evict the occupants.

On newly vped auction units, occupants are likely tenants.

I don't understand the bold. Provision for bad debt is a matter of it gets booked under which month or which year. It certainly has impact. You cannot say it has zero impact.

Provision is provided/booked when the loan is classified as npl. By the time borrower is declared bankruptcy, this provision is already provided for.

So it still has impact.

If it has no impact, why won't bank even bother to auction the property ? Why would it even bother to slowly dropping the auction price ? Certainly somebody in the bank's organisation would be interested or responsible for recovering as much as possible.

Legal action include auction, bankruptcy proceeding, etc is to recover provision provided.

There are certain established rules and regulations bank need to follow on recovery e.g drop in reserve price after auction failure. Bank's priority is to recover quickly without compromising it's legal's position.

But you already said bank has full discretion over the property including evicting the staying owner. So evicting the staying owner does not compromise its legal position. Your only argument is thus reduced to bank want to stick to the old practices.

As said previously; if borrower is genuinely in trouble but still has the will and capability to repay, most banks would restructure the facility. bank is not in charity, could only restructure only at most 2 times. if the bank decided to recall the facility i.e auction, it will handle by different department e.g recovery, legal,  which borrower hardly has access to or meet.

It is also bank's discretion not to evict occupants.

bank never evict occupants lah……

discretion never comes in play.

have you ever seen bank halau occupants like a dog on to the street and pad locked the unit?

too much liability later