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Legal Documents to check before buying a house

Property legal documents are an imperative part of any property investment. The exact laws governing the sale of the property might be to some extent different in different states, but there are a few permissions and documents a builder or promoter must have if they are selling flats. Here are the permissible documents that you should check before buying a house from a builder. 

In India, buying a house is a mainly challenging task with quite a few possible hurdles along the way such as new brokers, title defects, complex contract laws, the condition of the property itself, and financing, to name just a few. 

Here is a list of few of the important documents that one must check before buying a property. (2).png

Title deed: When buying property one must seek for the legal documents regarding the ownership of property. 

Title deed is original deed and is imperative to authenticate that the property is in the name of the retailer and he has the complete right to vend it. Title deeds are paper documents showing the series of possessions for land and property. It includes contract for sales, wills, leases, mortgages and also conveyances. If you do not shave the original deeds and the property has not been registered previously then you will need to fulfill various additional necessities in order to verify valid title. 

It is probable that a ‘Possessory Title’ may be offered in cases where full title cannot be proven. In most cases, Title Deeds are retained by the mortgagee until such time as the loan is repaid.

Mother deeds: It is very important to outline the ownership of a property, particularly when it is either being purchased or is being presented as a security. Also it traces the conveyances deeds. Tracing ownerships should always begin with analysis of the original deed recorded. 

If such documents are not made available, certified copies have to be obtained from the registering authorities. It is also known as parent deed. 

The series should be in chronological order, incessant and constant. Any missing link has to be carefully scrutinised by referring to the records at registering offices, revenue records and recitals in other documents, and if possible, by ascertaining from the parties concerned. 

It has details such as: Location, road, door number, details of contiguous properties and parties involved, insurance provisions for the parties, proprietor and transferor, consideration agreed upon, advance amount paid, mode of payment, block and ward numbers, time limit for payment of deliberation.

Intimation of disapproval: A set of documents are required to be submitted by the vendor in order to obtain a building approval plan. These involve acquiring approvals and a No Objection Certificate (NOC) from various departments such as the Storm Water and Drain Department, Sewage Departments, Forest Department, Environment Department, Traffic and Coordination Department, Chief Fire Officer, Airport Authority and Pollution Board, among others. 

If the seller has taken a home loan and the assets are mortgaged with a Bank then, the seller should take a No Objection Certificate from the Bank or if all dues are cleared, then a No Dues Certificate. 

One also needs to get a No Objection Certificate (NOC) from the society stating that they don’t have any tribulations in transferring the property to your name subject to all payments and agreements between purchaser and vendor.

Commencement certificate: A Commencement Certificate is a deed from the confined municipal authority that proves the authority of a real estate project and permits the developer to initiate the construction of the project.

 A Certificate of Commencement is obligatory to inaugurate any construction of a property and is given by the Town Planning Department. This record is given only once in all other approvals and clearances are obtained by the builder.  

Failing to attain a Commencement Certificate will result in the edifice being considered illegitimate, impose penalties and can even draw an expulsion note.

Encumbrance certificate: Encumbrance means charges in the possession or liabilities bent on a property that is apprehended against a home loan as security. 

When buying a house, flat or plot, it is essential to validate that the property does not have any fiscal or permissible dues. And encumbrance certificate (EC) ensures that there is a complete ownership of the property without any pecuniary or legal accountability. T

he encumbrance certificate is issued in Form No. 15 and 16.  If the property does not have any encumbrance during the given phase, Form 16 will be issued i.e., certificate of Nil Encumbrance. 

If the property has any encumbrance registered during the given time, then form No. 15 will be issued. 

The certificate in form 15 reveals the documents registered with respect to the possessions, division, charter and finance, nature of the encumbrance such as gift, the parties involved, the registered number of the document and other details in a date-wise manner.

Approved layout plans: Some of the builders launch and sell properties without approved layouts. A building possessor has to get a permitted plan from the jurisdictional Commissioner or an officer authorized by such Commissioner.  

One should never invest in a project which has not conventional approvals. If any builder avoids showing you the copy of approved layout, you should abstain from investing in such project. 

Homebuyers need exercise caution as there have been cases where developers deviated from the approved layouts, by adding extra floors or reducing open areas.

Purchase agreement: Also called as Builder-Buyer agreement. The agreement contains all major details of the construction project such as the project specification, apartments, payment terms, completion deadlines and the type and amount of penalty, should any party default. The developer will sign Builder-Buyer Agreement with you after you pay 20-30% cost of property. 

The agreement should also contain an article to transfer the common areas to the society. This ensures the plot remains with the original owners and that the developer cannot engage in advance construction on this land. 

Make sure to go through properly before you sign it.

Occupancy certificate: The occupancy certificate is obtained after the completion of the construction. Certificate is also issued by Municipal Corporation after ensuring that basic amenities like Electricity Connection, Water Supply and Sewage Connection etc. are provided as per the approved plan. 

The legal documents are a verification of the building’s acquiescence with applicable building codes and other laws. It indicates that the property is in an appropriate form for occupancy. 

A completion certificate is received by the builder from the metropolitan authorities upon completion of construction.

Since this was the listing of key documents you must need to make sure before buying property, we really hope that now you can do better due assiduousness of property documents before you buy a property.

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