Big Blow To Borrowers As Banks Reject Tittle Deeds As Security For Loans

Title deeds are apparently rarely accepted as collateral by banking organizations before extending credit to Kenyans.

Banks utilized land as collateral to guarantee the borrowed funds before they had a change of heart. Usually the value is equal to the sum being provided.

Since most banks were confident they could avoid losing money in the event of a default by recovering the assets through foreclosure or repossession the use of land as collateral was widely accepted.

However, more instances of land fraud forced commercial institutions to alter their rules.

Speaking to Kenyans.co.ke attorney Nyokabi Ndung'u alleged that some Ministry of Lands officials engage in questionable business dealings with clients who produce phony end title deeds.

According to Nyokabi it is challenging for banks to confirm the authenticity of title documents because false ones are even listed on the land registration.

In order to deceive the banks certain land officials work with brokers and decide to create bogus end title deeds that only exist for a short time Nyokabi said.

Land surveyor Bernard Wanjohi argued that some maps are out-of-date and bank representatives sent during the confirmation process are compromised.

When maps are out of date some people engrave fictitious maps of land they want to sell on them.

Content created and supplied by: Rajo (via Opera News )