Quick checklist for home buyers

In our country, India, the considerable significance is attached to the ownership of the property. While for the rich, it certainly connotes the sense of prestige and power, for the vast majority of the middle-class population, its cherished dream as well as unfortunate lesser privileged, it is the luxury beyond the reach. While some nations have somewhat simplified the process of property buying including the authentication of the documents of ownership by the government, in the Indian context, the process of identifying the property right is fraught with various risks, regulatory and legal hurdles. The property buyers are at times the mercy of the builders or brokers and motivated to make the decisions by the promise of the exponential returns or the irresistible offers. However, the lucrative and tempting prospect may appear, it is imperative for the property buyers to exercise the cautions as well as appropriate legal advice to safeguard the interest before property buying.
Verification of title and ownership of the seller
It basically is a settled legal principle that any person can’t convey better title than what there is. As the prime step, the property buyer should undertake due diligence to ascertain the existence of title with the seller, title nature and the marketability as well as the ability to the property seller to convey clear and the marketable title, and free from encumbrance. For the period of 30 years, the documents if not more, where the documents aren’t available, for a limited period of 12 years, must actually be examined and the seller may be called to provide following information or documents-
• Title documents of property- government order for grant, sale deed, succession certificate, will, gift deed, partition deed, etc., evidencing the transferring of title over years culminating the property vests with the seller.
• In the case of seller claiming the development rights to property, power of attorney, development agreement, executed by owners in the favor of the seller
• Title nature- freehold, leasehold or development right
• Khata registered in seller’s name
• All the title documents being duly stamped as well as registered at the office of jurisdictional sub-registrar of assurances
• Availability of original documents of title with the sellers
• Information on pending or past litigation
Verify the identity of the seller
Alike to verifying the property title, the property buyer should ascertain the identity of the seller as well as any specific conditions, governing ability of the property seller to properly convey.
The residence statuses as well as the nationality of the property seller, in case of the individual, as well as consents from authority government are required for sale.
The identification of all the owners, in case of properties held jointly.
Where the seller is the organization, partnership form, trust, society, etc., the documents of the constitution of the entity are important, transfer the property, to confirm the ability to own, besides ascertaining the person executing as well as registering the sale deed is duly authorized.
The orders from the competent court, permitting the sale of the property as well as appointing the guardian where the property is held by minor or the person of unsound mind.
Conversion and land use permissions
With the increasing urbanization and merging the revenue lands with modern conglomerates, conversion of the property for non-agricultural use assumes crucial significance since the various state laws restrict buying the agricultural property by on-agriculturists. Secondly, property buyer must examine the master plan as well as satisfy the property developed in accordance with zoning plan like residential, industrial, commercial, public/semi-public, open spaces, parks, etc. where the actual use is varied from notified zoning, obtaining the orders from Town Planning Authority permitting land change use is compulsory.
Construction Approvals
For the purchase of the land or the apartment with the constructed building, the property buyer should also scrutinize the layout plan or building plan sanctioned by local municipal authorities with approvals issued by the statutory, government and the regulatory authorities for giving infrastructure facilities, sewage, water, environmental clearance, electricity, fire safety approvals, etc.
Occupancy certificate
It is compulsory for the seller to obtain the occupancy certificate from the competent authority, before conveying the property. Use property without obtaining occupancy, exposes buyers to penalty under applicable building the bye-laws besides the risk of the demolition of the property.
Check the status of tax payment
Non-payment of the property taxes constitutes the charge on property that affects the marketability. Thus, buyers must verify the municipal authorities that seller hasn’t defaulted on the payment of property taxes.
Encumbrance
The searches at jurisdictional sub-registrar of the assurances where the documents of property are registered as well as the available information on the official web portal of Ministry of Corporate Affairs in case of property seller being corporate entity will basically reveal information of the registered encumbrance on the property. By way of the caution, the buyers may also issue a public notice in the newspapers prior to completing transaction while calling for the interested party, if there are any.
Physical survey and access to the property
The property buyers may undertake the physical survey and confirm the extent as well as the property measurement. In land case, it is advisable to actually identify and demarcate boundaries, access to the property and further ascertain any other physical attributes that may impede the enjoyment of the property.
Compliance with Real Estate (Regulation and Development) Act, 2016
Real Estate Regulation and development Act makes it compulsory that the developers should register the properties with authority constituted under this Act. The property buyer intending to purchase property in the project coming under the ambit of Real Estate Regulation and Development is advised to verify property has been resigned with authority under Real Estate Regulation and Development. The information is available on official web portal of Real Estate Regulation and Development for each state, giving details of any cases or the complaints filed against developer of property as well as the default by the property developer if any and thus giving useful insight into credibility of developer and project helping the property buyer make the informed choice.
Conclusion
While property buyers, it is better to err on side of caution. With complete legal advice, verification of relevant information and scrutiny of documents pertaining to property, the property buyer can make sure that investment brings to mind peace and sense of security.