Parate Execution: How Bank Auctions Work in Sri Lanka
December 25, 2025
Parate Execution: How Bank Auctions Work in Sri Lanka
Key Takeaways:
- Speed: Banks don't need a court order to sell mortgaged property.
- Notice: They publish a notice in the newspaper.
- Opportunity: You can buy lands at 30-40% below market value.
Parate execution allows commercial banks to recover bad loans quickly.
For Buyers: The Auction Process
- Paper Advertisement: Listing the auction date.
- Inspection: Usually allowed 2-3 days before.
- Bidding: You must bring a bank draft for 10% or 25% of the bid value.
- Balance: Must be paid within 30 days.
The Catch
Bank auctions are "As is, Where is".
- You cannot check the title (it's assumed the bank checked it).
- Squatters: If the previous owner refuses to leave, you have to evict them.
Verdict: Great bargains, but high stress.