Buying your dream house? Here's a checklist to bear in mind
Nov 15, 2013
Source : The Economic Times


MUMBAI: The ongoing Campa Cola compound stand-off in Mumbai has clearly unnerved many prospective home buyers.

For many average home buyers, buying a home is about the price, location and amenities like club house and swimming pool. But one should give equal importance to verifying the credentials of the builder, and legalese-filled documentation procedure is an intimidating thought for many of them. However, according to experts, buyers can't escape this aspect while buying a home, especially since the real estate sector is going through a rough patch. Sure, you can hire a lawyer to do the job for you, but you still need to be in the loop.

For Ready-for-possession Flats

"When you are buying a flat from a developer, you have to consider two aspects. One, the title. That is, you have to ascertain whether he is actually the owner. Secondly, you need to find out if the construction is legal and authorised," says Sadhav Mishra, partner with law firm SN Gupta & Partners.

You have to see the title deed to ascertain the title of the seller. This will include the sale deed, deed of conveyance, the development agreement and the Power of Attorney (PoA), if the developer happens to be the seller.

"It is advisable to go back and check the title transfers in the last 30 years. You need to ascertain how the transaction has flown from the first seller to the last," Mishra adds.

There are chances that the builder may not always part with earlier title documents. If that case, you should ask the builder for the building agreement, power of attorney and the deed of conveyance if the builder has got the land conveyed in his name.

You also have the right to ask for the title certificate from the developer's lawyer. "Ask for the developer for the approved drawings of the project, a copy of the intimation of disapproval (IOD) and completion certificate. Ensure that the property is free from any litigation and any kind of associated debt," says Anuj Puri, chairman and country head, Jones Lang LaSalle India.

In addition to IOD, completion certificate and the approved plan, you need to ask for the occupation certificate (OC). "If the building has been in existence for quite some time, you must ask for the details of the property taxes being paid to the municipal corporation," says Mishra.

If you are buying a flat in a building where the co-operative society has already been formed, you need to ask for three key documents — the seller's share certificate, a no-objection certificate (NOC) and a letter from the society, stating that the seller is indeed the owner of the property, and there are no liens against the flat and it is free from any encumbrances.

If the Property is Under Construction

If you are buying an under-construction property, you must go through the approved sanction plan, IOD and commencement certificate issued by the municipal corporation. Again, the key is to establish whether the builder has clear ownership of the land on which the project is taking shape. "An agreement between the builder and the original owner is not sufficient. The project also needs to have an IOD. This is a set of instructions that a developer needs to comply with so that he can legally construct the project. It is valid for one year and needs to be reissued if the project has not been completed in a year's time," says Puri.

If the construction is only partly complete, you need to exercise extra caution. If you are buying a flat on say the 30th floor, while the construction has been completed only till the 15th floor, you will not get the occupation certificate as the building is still under construction.

"In that case, you must insist on seeing the commencement certificate, particularly for that floor," says Mishra. According to Puri, projects that are in the pre-launch stage, too, need additional scrutiny. "It is even more necessary to establish the trustworthiness of the builder, especially in terms of his track record for transparent dealings and compliance with legal formalities," he says.


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