Closing the Gaps
Property paperwork simplified, need for a critical illness plan verified, the convenience of personal finance apps explained and a lot more in our special on smart money moves
Buying property is an increasingly common experience, and one that most consider an essential part of ‘making it big’. That said, property purchases can also be risky, and mistakes can cost lakhs, even crores. Missteps can be shatteringly expensive. So, here’s a checklist to keep in mind to avoid ugly legal surprises.
LEGALLY SOUND?
In July this year, apartment owners in Supertech’s Apex and Ceyane towers in Noida found themselves in the news. The Supreme Court (SC) had ordered an investigation into whether Supertech had flouted norms on building limits during construction. This was just one event in a long saga—the SC ruling had followed an April 2014 order issued by the Allahabad High Court to demolish both the towers. Problems like these are not uncommon. When checking up on the property you intend to buy, make sure there are no legal complications of this sort. The difference between ‘legal’ and ‘almost legal’ can be slim, but can also end up costing a fortune. TITLE DEED/KHATA Make sure to visit the sub registrar’s office to get information about the title deed of the property you intend to buy. This deed verifies that the property is indeed in the seller’s name and is free of any encumbrances. The khata is an entry in the record books of the municipal office, noting the name of the current owner and confirming that ownership of the property is not disputed. These documents are necessary to obtain water and electricity connections, as well as home loans.
OCCUPANCY CERTIFICATE
This certificate is issued by the district administration after your details are submitted by the seller. The documents verify that your property meets the required construction guidelines and is, therefore, eligible for water and electricity connections.
MARKET PRICES
Make sure to thoroughly check prevailing market prices in the area you are looking to buy in. If you’re getting the property dirt cheap, dig further. If the deal sounds too good to be true, it probably is. Overly low property prices might indicate some kind of fraud or illegality. Steer clear of complications like this, because they will cost you later.
BUILT TO PLAN
Ensure that the construction is exactly as permitted by the regulatory authorities, or you might face fines, or worse. If buying an apartment in an already constructed society, confirm that the registration papers of the society are in order.
ALL DUES PAID
The encumbrance certificate will tell you if the property has any dues outstanding, such as taxes. If the property is part of a society, then you need to get a no-objection certificate from the society before moving in. Property tax is paid once a year; if not paid, fines and penalties may apply.
OTHER ISSUES
In case you choose to purchase mortgaged property, make sure that the required payments thus far have been made on time. Banks tend to approve loans only for properties that are free of all legal and financial complications. Always check that the documents you require have official approval (if necessary) before finalising your purchase.