If you are looking to buy a property in the near future, beware of some common property frauds. Here are a few checks that you should have in place before taking that step. These will not only ward you from the entire gamut of real estate scams but also guard you from false promises of the builders.
Here’s a lowdown:
1)Title deeds and clearance:
There have been property frauds where scammers have duplicated title deeds of vacant or disputed projects and sold them to innocent buyers . The scammer will use false documents to pose as the property owner, registers forged documents transferring a property to his or her name, and then gets a new mortgage against the property.
Thus, it is important to check that the title deeds and paper work are free from any encumbrances. You can check these link documents at the office of the sub-registrar. Ensure that there is no encumbrance, pending legal case, property dispute or lien on the property. Once you make the initial payment for your house, ensure to get the allotment letter if it is a builder and an “Agreement of Sale” if you are buying an existing property. Your purchase of property will be completed only after the sale deed is executed and registered with the registrar. The sale deed is a proof of your ownership.
2)Executing the purchase and follow up activities
Make sure your builder sticks to the possession date that he has promised because often builders delay when they do not find buyers or their resources dry up leading to no money left for completing the project. Getting possession of your house as soon as possible has several benefits, one being the tax benefits that kick in after possession. The period prior to the possession date has a different tax treatment as pre-construction period.
Once you get possession of your house, the builder is responsible for maintenance of the building for a period of 18 months after the Occupancy Certificate (OC) is given. By the end of the 18 months, the builder will initiate the formation and registration of the society, which will elect its representatives and take over the management of the society from then on. Once the society is formed, telephone and electricity bills will be given in your name. Hence, it’s important to ensure the society is formed within the stipulated time.
Even though the builder may have a handful of successful projects, it is important to ensure that the builder lives up to his promises in the existing projects. Property frauds like delays and disappearing builders are a common occurrence in real estate. One strategy unscrupulous builders resort to is to delay project completion deliberately until they get requisite number of buyers. Yet others divert the money pooled from one project to another, delaying both projects in the process. One way to prevent this is to go for projects that have been approved by banks. Not only does it put the builder under obligation to complete the project in time but your tie up for finance is also taken care of. Another way to ensure it is to see if there is a delay clause in the agreement and that the construction stages with timeframes are clearly included in it.
4)Delay in utilities:
Not only project delays but also delay in approvals and sanction for utilities can leave buyers wringing their hands in despair even after possession. Thus, it is best to check for sanctions for utilities like electricity connection, water connection, etc. were pending. Property frauds like plot in unauthorized layout or sub-divided land, building with land use violation, setback violations, floor area violations, etc. detected after agreement formalities and construction have commenced could lead to delay in other downstream approvals and title registration.
5)Deviation from Approved Plans:
One important thing to ensure while buying a property is to ensure that it is similar to what the builder had promised. Many projects when completed take several deviations from the approved plan in terms of common areas. This possesses a huge challenge for many buyers who have to compromise on common amenities, spaces, promised luxuries and even on core project amenities like dedicated parking space despite having made additional payments for the same. The best to prevent this is to get the assurances on paper.
Keep these points in mind and do not fall for any property frauds by any developer and builder. Visit http://namratagroup.com/ to look for property options.