The Indian Real Estate Industry is one of the most rapid and booming sectors due to an increase in urbanization and the gradual shift in spending patterns. Buying a property is a huge financial commitment. It is not every day that one decides on buying real estate, right? So, one has to be extra careful at the time of buying the dream home.
Although the Indian real estate industry has customer-friendly rules and regulations, it is important for a person to be alert as there are involvement of multiple parties and an overload of paper-work.
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The following key aspects should be considered while buying property:
In most scenarios, there are intermediaries involved in negotiations and discussions vis-a-vis properties. Hence, it becomes important for a buyer to ascertain the true owner of the property, so that one is not cheated or involved in any fraudulent practice on behalf of the owner and/or intermediaries. One must be cautious that the agreement is being executed between the buyer and true owner of the property only, failing which, legal complications might arise in the future.
At the time of buying a property one must always check if the property is verified and approved by the banks and other financial institutions. Due diligence by banks acts as a safeguard against fraudulent activities.
One should always verify the property's title deed as it is crucial if you want to ascertain if the property is in the developer's/seller's name and also to cross-check if the right to sell lies with him. It is also advisable to check the original title deed rather than relying on photocopies provided by the seller. You can get it further examined by a reputed legal consultant so as to avoid legal hassles.
4. Completion certificate check
A Completion certificate is issued by the municipal authority that confirms whether the building is built according to approved plans and is fit for habitation. It might happen that the local authorities may consider the building or its part/s illegally constructed resulting in a demolition.
Buyers must procure a copy of the approved building layout from the developer or seller of the property. This helps confirm that the building plan, layout and construction is approved by the authorities hence, mitigating several risks such as delay in execution or cancellation of project plans. This quick check will ensure that the plan is legitimate and the buyer is not cheated after the down payment.
One must confirm if the area details are apt as developers often use terms like super built-up area, built-up area and carpet area to establish and communicate property prices. A buyer must re-verify the carpet area of the property under consideration by measuring the actual area and not merely relying on details mentioned in the brochures. To prevent further disputes, the same area details must be mentioned in the agreement as well.
Before buying a property, one must check if the property has any legal dues. The encumbrance certificate must be procured to check if the property is mired in any legal disputes and complaints. If the property is in a society (in case of a resale), a no objection certificate (NOC) from the society must be obtained. This will help in checking and safeguarding the buyer's interests and he/she will not be levied any additional charges on account of any unpaid dues.
There are instances when the developers or sellers quote a lump sum price on the property. In this case, it is recommended that a detailed cost breakup be obtained, clearly indicating the nature (breakup) of cost and the tenure of payment that is included in the lump sum price. In addition, it is essential that this cost breakup is included in the agreement so that it is legally binding.
If the property is not registered with the Government/local authorities in the buyer's name, there could be legal problems. It is smart to register the property at the earliest, so that it is legally in the buyer's name and the seller does not execute multiple transactions for the same property.
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