Buying property is a serious business, because you are not only
buying a dream property but also your investment in life. It is obvious that
you don’t want to invest on property which causes problem or risk in future.
You may be searching for a guide to understand simple procedure for smooth and
easy buying of property.
Here is an attempt to provide a simple guide for cross-checking
before buying a property.
1. Ask for Photocopies of all deeds of title, revenue records and
all other documents related to the property to be purchased.
[Easy Checklist for
Purchase of Property, to understand the documents list and names]
2. Do not buy a property if the title of property is
not clear. If title is not clear or marketable it will cause problem in future.
You can seek assistance of your lawyer to know whether the title of the
property is clear.
3. Origin of the property is very important to
trace the title of the property. Documents covering a minimum period of 41
years must be scrutinized.
4. After ascertaining origin of the property, you should ensure
methodical examination of events and subsequent transaction.
5. Revenue records must be verified, revenue
records should bear the name of the seller.
6. Ensure that seller of property has all documents relating to
property.
7. Ask for original property documents and
compare the same with photo copies provided for scrutiny.
8. You must physically verify the property. On spot,
you must verify the property physical measurement and boundaries; it should
tally with the measurement and boundary mentioned in the documents. You
must also ensure that there is no physical encroachment on the property. You
may also make enquires with the adjacent owners about the ownership of the
property.
9. You must ensure statutory clearances (like
local clearances, NOC’s, Conversion, unto date taxes, etc), with regard to the
property.
10. You may notify in a leading newspaper about
your intention to purchase the property. Though paper notification is
optional, sometimes when published you might receive response from a genuine
claimant. This will help you in understanding disputes if any with regard
to the property and avoid legal problem at a later date.
11. Property must be duly converted for residential
purpose/ occupation, by the order of the competent authority.
12. Get copy of the approved layout for the
building from your builder or seller of the property. Compare photo copy with
the original plan. Ensure that building plan or layout or construction is
approved by the concerned authorities and the property you intend to purchase
is within the approved plan.
13. Confirm Stamp duty, Registration charges and transfer fees to
be paid on purchase of the property as well as other outgoings to be paid for
the property i.e. property tax, water, electricity, maintenance, society
charges etc. Get good idea of total cost of all
components with regard to property purchase, though all components are not
immediately available, but should be factored into total cost.
14. Access to the property is critically
important. If access is difficult, re-sale values will be affected, and may
cause day to day inconvenience. You may also ensure proximity to
bus stand, hospitals, market, central business district, hotels etc.
15. Check around with local sources to find builder or
developer or seller reputations.
16. There must be nil encumbrances on the
property. You must ensure that all existing charges (including mortgages) are
cleared by the seller before entering into any transaction.
17. Ensure that the property you are buying has adequate water
and power supply and sewage facility.
18. You must retain and backup all the correspondence or
documents made with the builder or developer or seller.
19. You must carefully read the draft deeds before
entering into any transaction (sale or Sale Agreement, etc.).
20. Avoid arbitration clause in contracts of
purchase. Arbitration clauses were apparently designed to reduce the time and
expenses of litigation, but many times may consume much time while appointing
Arbitrator if the other party does not consent and many times arbitration
clause empowers the builder to appoint the sole arbitrator, which is not
agreeable and Arbitration proceeding cost may end up much higher than the court
fees.
21. If you have belief in vastu, get consultation done before
buying the property.
The foregoing is not a complete list of preventive measure, but is
only a guideline, but hopefully it might be useful for people considering
buying and selling of property.
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Prepared by: S. Hemanth
Advocate at Hemanth
& Associates
For Suggestions and information email legal@hemanthassociates.com
