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Be Advised Take a Legal Opinion Before Home Buying

Posted by : Pooja Agrawal on | Dec 27,2019


Buying a home is so much more than just paying money to the builder and taking possession of your unit. There are many legalities that you as a buyer must go through before the keys are handed over and some of them may even be new to you. In such situations taking legal help from a professional should be your priority. That’s what we are going to discuss in this blog.


A new home buyer is a novice and may fall into the various real estate marketing pitfalls. As there are numerous choices, offers, and benefits, you may get confused and lose your right path to be the victim before you even realize. In order to counter this situation, you must be aware of the rules of the real estate game before you think of entering into it. Thorough market research is and should always be the first task at hand to complete. Here, the internet is your best friend.


Now let’s assume that you did your research and are ready, it’s time to step up a notch, Enter Financial Planning. Your terrain has now changed. Financial planning is not something that you do overnight. It takes years of discipline and dedicated savings to fulfill your home down payment needs which is 20% of the price of your desired property. The next step is obvious, applying for a home loan. Since you’ll be tied with repaying your home loan for the next 20-30 years, selecting the proper home loan is a must. Learning about different financial lenders and the offered Rate of Interest will play a crucial role later down the line. Also, knowing about the different types of ROIs can help in the long run. Consult with a financial expert before making your move.


They say ‘well begun is half done’. If everything goes as planned and you are set with your finance, half of your battle is over. However, the next half will be equally rough. Let’s continue…


The documentation process of a home buying transaction is much complex and can be out of the understanding bounds of a new buyer. You may be unfamiliar with the varied laws and regulations associated with your home deal closure. Your lifelong income is associated with this and hence it is always advised to take a legal opinion to safeguard your interest.


Legal Due Diligence: It is the process through which you can minimize the risks associated with a real estate procedure. At this stage, you must not ignore anything and proceed with caution as it’s a critical aspect of the home buying process. If anything goes south then you’ll be stuck in an unnecessary indictment which could make you lose your ownership or even pay penalties. Think rationally before you proceed as the real estate process is a very legally sensitive matter. Hiring a lawyer is your best bet under such scenarios. Having a draft agreement created by the lawyer between you and the builder is advisable.


The following are the necessary steps to complete your legal due diligence:


  1. Chain of Deeds/Title: This document tracks the ownership of the land/property from the present owner all the way to the original owner. When buying ensure that the historical transfers of the property are in order without any missing link. Your lawyer would research the deed to ensure that the builder has the title clearance for the land on which the property is built. Ensure that you verify if the builder has complied with the laws and procedures related to the construction of the property.


  1. IOD, Completion & Occupancy Certificates: IOD or Intimation of Disapproval means that the builder has obtained all the required NOCs which is finalized by providing the Commencement Certificate. Completion & Occupancy certificates are also issued by the local municipal body stating that the property satisfies the building standards as per the originally approved plan and has all the necessary clearances such as electricity, water, fire safety, and sewage.


  1. There are various other legal certificates and documents that need to be finalized prior to the possession of the property such as Encumbrance Certificate, Sale Deed, Allotment Letter, Possession Certificate, Tripartite Agreement, Maintenance Service Agreements (MSA), No Dues Certificate, Joint Development Agreement, and others. At last, there are multipletax benefits under section 24, 80C, 80E, and 80EE.


  1. Finally, there are few things that you as a buyer must check before taking the keys to your new home. Ensure that the final setup of your property is the same as it is mentioned in the brochure/agreement. Measure the dimensions of the living room, bedroom, kitchen, bathroom, balcony to make certain that you are being delivered what was promised. Verify that all the safety measures are in place. Check the walls, flooring, paint for any cracks or major defects. Look for safe electrical connections and ensure that the provided equipment such as lights, sockets, plugs, buttons are working properly. Make sure that there’s no broken wiring anywhere around the house. Check if you have proper water supply at the required places.


You can also hire a home inspection service that will do all the work for a nominal fee. At last, obtain all the set of keys to your home to be on the safer side. You can consult with professionals for more refined guidance. Taking a legal opinion before every step is advised.


Good Luck!