Several prospective home buyers have been unnerved by the ongoing stand-off at Mumbai's posh Campa Cola Society. For, in a city where space is a premium, the Campa Cola case should serve as a wake-up call for home buyers. So, if you are thinking of buying a ready-to-move in property or a flat from the secondary market, make sure you scrutinise all the necessary documents or else your dream home could turn out to be an expensive disaster. It's best to hire legal experts and professionals before you take a decision. Here is a list of documents that are extremely important to check.
1.Title deed:The first step is to check the title deed of the land which you are going to buy. Confirm whether the land is in the name of the seller and that the full right to sell the land lies with only him and no other person. You also need to check whether the seller has permitted any entry/access to others through this land and whether any other fact has been suppressed/left undisclosed by the owner of the land. Along with the title deed, the buyer can also demand to see the previous deeds of the land available with the seller. The title deed will includethe sale deed, deed of conveyance, the development agreement and the Power of Attorney (PoA), if the developer is the seller.
2. Government-approved plan:Make sure the builder has got the approval for building the flat. If he has started the constructions then make sure that the approval building layout is same and there is no deviation in the house or flats. If there is deviation then it could create future problems.
3.Encumbrance certificate:Before buying land or house, it is important to confirm that the land does not have any legal dues. To ensure that the property you are going to buy is not mortgaged for loan, you must obtain the encumbrance certificate from the sub-registrar office where the deed has been registered, stating that the said land does not have any legal dues and complaints.
4. Ensure property is free from debt and liabilities:Ensure you are buying a property which is free from debt and all taxes are paid in time. If seller of property has taken any loan or advance on the property, ensure they are paid off and ask them for documents or copies to show that property is debt free.
5. Tax receipt and bills:Property taxes which are due to the government or municipality are a first charge on the property and, therefore, enquiries must be made in government and municipal offices to ascertain whether all taxes have been paid up to date. The owner should also possess the latest tax paid receipts, which you may inspect.
6. Intimation of disapproval or IOD:This is a set of instruction given by respective authorities for builders to construct the building. Normally, it is valid for a period of one year and if the building is not constructed within one year's time, IOD has to be reissued.
7. Sales Certificate:Get the sales certificate between the builder and yourself.Check whether the seller obtained a loan for that property, accordingly a paragraph in sale deed needs to be added saying that the seller is responsible to clear all the dues.Mention the flat number and plot number in South/East/West/North/Complete Land area Length/Breadth and Diagonals also in the Sale deed.
8.Completion and occupation certificate:Once the construction is complete, builder will get completion and occupation certificates from the municipal authorities, which indicate that the building has adhered to municipal requirements.
Building completion certificate ensures whether the building complies with the rules of building height, distance from road, and whether it is built according to approved plans and is ready for habitation while theoccupation certificate is issued when the building is ready for occupation after water, sewage and electrical connections are complete.
"An original copy of the occupation certificate by the civic body of the locality is mandatory. It is vital in the sense that this document confirms the possession to the buyer legally; otherwise a mere handing over of the possession will stand null and void, in case a dispute arises," saidDilip Shah, a senior counsellor and analyst for redevelopment of housing societies and society laws.
Here is a quick check list of all the necessary documents, according to advocate Vinod Sampat:
Have a clause in the agreement that if the seller terminates the agreement or does not givepossession on the due date then he will pay double the amount that has been collected byhim till date.
Take irrevocable power of attorney from seller.
Insist for clear and marketable title certificate from the advocate of the vendor.
See that the earlier chain of agreement is duly stamped and registered.
Insist for no-objection certificate from the society.
Have the area physically measured. Also see that the carpet area tallies with the societyrecord as well as with the records of the Bombay Municipal Corporation. There areinstances were builders have fooled flat purchasers by selling open passages. The area asreflected in municipal records is the correct records.
Have clear cut idea of hidden expenses like transfer fees, brokerage etc.
Have separate agreement for furniture item. This will help you in saving stamp duty whichis 3% on moveable property and 5% on immovable property.
See that the seller has paid all his income tax dues.
Inquire if there are any notices received pertaining to the flat. Take an affidavit from theseller. In case of dispute this can help you to initiate criminal action against the seller.
Documents should be signed before a notary and the notarial number must be mentionedin the document otherwise it becomes a defective affidavit.
Inquire about incidental benefits eg. car parking spaces that would be allotted by the society andclub facilities.
Before paying token amount get the draft of all the papers approved from the seller.
Ensure that the seller is holding the flat not as a trustee.
Find out the market value of the property as well as the impact of capital gains tax on theseller. At times deals get cancelled if the seller has to pay high amount of tax.
Check the status of the property after verifying the property card.
Ensure that the entire chain of documents are mentioned in the agreements.
In the event the flat is acquired by the transferor on account of demise of his familymembers insist for probate/letter of administration. In the alternative insist on the consentof all the legal heirs preferably as confirming parties.
You have to ensure that proper precautions are taken else you can face problems whenyou offer the flat as a collateral or at the time of transfer of flat.
Check if the occupation certificate/ building completion certificate is received.
Updated Date: Dec 21, 2014 03:53:24 IST