In India, the process of purchasing a flat or property on sale can be challenging and confusing. The process requires voluminous documents for authorisation and regulation. However, once you have identified a flat on sale, you may have multiple questions on your mind which needs to be clarified before proceeding to buy that flat. Questions such as:
- Whether the building/society (where you are planning to buy a flat) is approved by the government or not?
- Does the preferred flat has any legal dispute or not & who are the correct owners?
- What is the mode of transfer of money and required documents?
If you get answers to the above 3 questions, then you are all sorted and can proceed to purchase the flat on sale. In this article, we will be explaining the steps that you must follow if you are looking for a ‘Ready to Move’ flat on sale.
Table of Contents
Steps for purchasing flat on sale
|Steps||Documents required||Steps to verify||Additional information|
|Step 1: Building/Society check||Occupancy certificate (OC)|
(This is the certificate that will confirm that the project has been completed as per legal guidelines. You must go ahead and purchase if OC is available.)
|I. You need to ask the Owner to show you the OC.|
II. To confirm if OC is valid and legal, see if it is issued by a Municipality Corporation or local authority.
|In case of a home loan, OC will be with the bank only then you don’t need to verify this since the bank has already verified it.|
|Step 2: Preferred flat ownership check||Title Document |
(A property title is a document that shows legal proof of ownership. It can be a sale deed, gift deed, or conveyance deed.)
(This declares that there are no dues on the property, and the title of the property is clear and marketable without any obligations. This contains details of all transactions done on the specific property.)
I. You need to ask Owner to provide title deed.
II. You can get them verified from the sub-registrar’s office.
Sub-registrar office issues this certificate.
To get this:
I. Go to the Sub-registrar office of the region where the property is located.
II. Fill out Form 22 with fees of Rs 100-200.
III. Then within 15-30 days you will get an Encumbrance Certificate.
IV. Review it thoroughly for any discrepancies.
In case of a home loan, you should check the copy of the deed since the original will be with the bank.
|There are some other documents which you can check at the first stage.|
1. Allotment letter from builder.
2. Car allotment letter.
3. NOC from RWA.
Since these documents will be transferred to you so get them mentioned in sale agreement (explained in next steps).
|ABOVE 2 STEPS CLARIFY THAT PROPERTY IS GOOD TO BUY FROM LEGAL PERSPECTIVE.|
There can be other documents as well which need to be verified but we can ignore at this point of time as we can get them through sale agreement.
Step 3: Paper/ Money transfer
3.a) Advance Payment + Sale Agreement
(Sale agreement mentions the terms, conditions of the sale. You can take lawyer help to prepare it.
Make sure it also mentions below documents to be handed over to you before executing sale deed:
1. NOC with RWA.
2. Allotment letter
3. Car allotment letter)
|I. Get sale agreement prepared by a legal expert.|
II. Make advance payment.
III. Get sale agreement signed from seller.
IV. Get sale agreement registered.
It is very important to get it registered as it will help you in case of any dispute.
V. Both buyer and seller should keep one copy of sale agreement with the signature of both parties.
Sale agreement is valid till sale deed gets executed. So, you must take all documents before sale deed is executed.
Many people get sale agreement notarized rather than registered, but it needs to be necessarily registered for a hassle free process in case of dispute.
|3.b) Full Payment + Sale Deed|
(Sale deed includes all the necessary details about the buyer as well as the seller of the real-estate possession. Only when sale deed is executed can we say the sale of a possession become final.)
|I. On the agreed date you must do full payment.|
II. Pay Stamp Duty through any of the below methods:
(Stamp duty is paid by buyer and it lies between 3-10% of property value. You can take lawyer’s help to calculate it.)
e-stamp: Visit shcil website and check banks/ACC where this facility is available and collect e-stamp after paying stamp duty.
(You cannot login to this site but can verify your e-stamp.)
Non-Judicial stamp paper: This is a popular method to pay stamp duty. You can buy stamp paper of equivalent stamp duty money through authorized stamp vendors.
Franking machine: Go to a bank with this machine and pay it.
III. Once you pay the stamp duty then draft the sale deed (with help from a legal expert).
IV. Get it Registered at sub-registrar office within 4 months.
(Fees for this will be either 1% of property value or max Rs 30K.) (You have to take appointment online or offline for the registrar office).
V. Collect original registered sale deed (in case of loan bank will take the deed).
In conclusion, buying a property in India can be a challenging and confusing process hence it’s important to be well informed to overcome these challenges.