Basic Legal Checklist to Buy A Property
Jun 13, 2018 Legal Guidance
Buying a property is quite a tedious and complicated task as it involves a lot of documentation and legalities which is a bit difficult to understand for any common person. Buyers are often dependent on the brokers and builders to complete the legal formalities like ownership documents, regulatory guidelines or registration process. But the buyer himself should be aware of documentation and legal formalities to be on the safer side.
Title and ownership of the property
The buyer should diligently verify the title of the property associated with the seller, nature of the title and whether it is free from any kind of legalities or not. The buyer should try to check property related documents for a period of about 30 years if that is too long then a minimum of 12 years.
The seller should be asking to provide certain documents or information that includes:
The seller should be asking to provide certain documents or information that includes:
- Property title documents: sale deed, gift deed, succession certificate, government order for grant, will, partition deed among others. If the title has been transferred earlier, then the evidence of the transfer of title over the years.
- Nature of the property title: whether the property is freehold, leasehold, freehold or development right.
- Registry documents in the name of the seller.
- If a seller is claiming the development rights to the property then the power of attorney, development agreement executed by the owners in favour of the seller is required.
- All documents related to the title of the property being duly stamped and registered from the jurisdictional sub-registrar of assurances.
- Any information on past or pending legal issues.
- Availability of the original title documents with the seller.
- The identity of the seller: the buyer should also be sure about the identity of the seller and ascertain the seller’s ability to convey the property.
Here are some points that need to be checked for sellers.
- The nationality of the seller and residence status.
- If any government consent is required for the sale.
- If the property is jointly held, then identification of all the owners is a must.
- Whether the seller is a company, society, partnership firm, trust etc, documents of the seller are necessary to confirm the ability to own or transfer the property apart from ensuring that the person registering and executing the sale deed is an authorised one.
- If the owner of the property is a minor or a person with an unsound mind, then orders from the court having permission for sale of the property or appointing a guardian.
Land use permissions
The buyers must check the Master Plan and verify that the property is developed according to the zoning plan such parks, residential, commercial space, open spaces etc. If the actual use is different from zoning plan the buyer should obtain orders from the Town Planning Authority permitting change of land use. Also, nowadays due to growing urbanisation, agricultural land is getting converted to non-agricultural purpose. several state laws restrict the purchase of agricultural property- hence the buyer must check this fact as well.
Construction approvals
The buyer also needs to carefully check whether the layout or building plan is according to the sanctioned plan by the local municipal authorities. It is necessary to ensure that the construction has all the required approvals by the government and related authorities for proper sewage, water, electricity facilities, fire safety approval;, environmental clearance etc.
Occupancy certificate
This is a mandatory document for the builder to offer occupancy to the customers. Occupancy certificate ensures that the building is in accordance with the building bye-laws and do not have the risk of the demolition of the property.
Tax payment status
The buyers should check with the municipal authorities for the payment of property taxes.
Compliance as per the Real Estate Regulation and Development Act (RERA)
RERA has made it mandatory for the developers to register their projects with authority. A buyer must verify whether the project or property has been registered under RERA or not. One can easily get the information about the respective property on the official web portal of RERA for each state. It also provides details about any cases/complaints filed against the developer. This offer information about the credibility of the builder as well.
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