Land Department Issues 9-Point Circular to Resolve Online Mortgage Issues

Kathmandu. The Department of Land Management and Records has issued a 9-point circular to resolve problems seen in the online process of land mortgage, collateral, and release. The department has given this directive to all land administration (land revenue) offices where the PAM system is implemented to facilitate blocking and release, at the request of the Nepal Bankers Association. The department has made a new arrangement after banks and financial institutions faced various technical and procedural problems when submitting mortgage and release deeds online. These are the main provisions of the 9-point circular issued by the department: 1. Easier to get additional loan: If the same borrower needs to take an additional loan from the same bank on the same collateral, the old mortgage deed does not need to be cancelled. It has been arranged to pass only the deed for the additional loan while keeping the existing block. 2. Partial release of land possible: If only a portion of the blocked land needs to be sold or subdivided, partial release can be done by opening the area or plot with the bank's consent. The remaining land will remain blocked as is. 3. House can be registered on blocked land: With the bank's consent, the landowner can update the details of the house built on the blocked land. After registering the house by paying the prescribed fee, the land revenue office will inform the concerned bank about it. 4. Application before 12 PM released the same day: The land revenue office must prioritize blocking and release work. Applications for blocking/release submitted before 12 PM should be released on the same day, and applications received after 12 PM should be released on the same day if possible, or by 12 PM the next day. 5. Work will be done based on voucher: Even if the amount is not seen deposited in the land revenue office account when paying service fees and charges online or through ABBS, the concerned bank and financial institution will be held responsible, and the mortgage blocking will be done based on the payment receipt or voucher. 6. Responsibility for loan and valuation: Regarding the passing of the mortgage deed, if the deed needs to be passed for an amount exceeding the valuation of the property or the resignation amount, the work should be done by specifying in the deed that the entire responsibility lies with the concerned bank and borrower. 7. Use of Tameli and system: Banks and financial institutions must print the confirmation of the deed and release letter passed through the online system and upload it through their land service center for Tameli management. The land revenue office must also provide information on blocking or release through computer printouts. 8. Single format for mortgage deed to be created: The department has stated that currently, due to the use of different conditions and formats in the mortgage deeds of various banks and financial institutions, there is a lack of uniformity. To bring uniformity to this, the department has also requested the Nepal Bankers Association to prepare a single draft model and submit it for discussion. With this circular, it is believed that it will be easier for banks and financial institutions to provide loans by mortgaging land, and the administrative hassle faced by general borrowers at the land revenue offices will be reduced, the department has expressed confidence.