When it comes to the user guide, it is important to read all the details and terms & conditions carefully before buying a property. Because usually, the booking order favours the builder of the project. Most of the clauses in the agreement focus on protecting builders from legal troubles, giving very few rights to the buyer. Also, the respective company expects you to understand all the clauses carefully as well as the obligations and liabilities.
Note: The respective allottee is expected to deliver the company signed allotment letter in its original form within 30 days of booking the property.
#Tentative Plans
• In case of tentative plans, allottees already accept the plan, designs and specifications of the property.
Usually, any sort of changes or conditions imposed by the authorities will be binding on both sides, the allottee and project developers. The developers don’t need to seek the buyer’s consent for any changes in the plan or layout.
• Plans may be changed or altered to any extent without being informed. The design shown by the developer during the sales cannot be considered the final pitch.
The only possibility in which changes will be eliminated is when you buy the property after the clearances.
#Inspection Check
• In case of inspection, check the allottee’s demands and allow various inspections for approvals, licences, and ownership records.
The developer holds the right to other documents related to the project.
• The buyer confirms that they have received all the required and necessary documents related to the project. There’s one more clause that the developer includes which ensures all the queries related to the buyer’s satisfaction.
It is essential to go through all the Q&As before signing the agreement related to the project satisfaction of the buyer.
#Cancellation Of Project
• Project authorities treat allotment letters as cancelled if the plan is not approved or is not in the position of implementation. In such a scenario the company refunds all the payments. Also, the company pays a simple 4% interest per annum for the period for which it held the money.
• In such cases, developers hold the right to abandon projects at any time. Which allows the builder to scrap the project for any reason, including the absence of approvals.
#Preferential Location
• If the location of the property becomes preferential due to changes in layout or design, the allottee has to pay preferential location charges. Charges are calculated at the rate mentioned in the payment plan or as per the demands of the company.
Also, if the property ceases to be in a preferential location, the company has to refund the preferential location charge by adjusting it in the last instalment.
• There’s no guarantee of a premium location, even if it’ll be your primary requirement. But there are chances that you’ll have to pay more if the location of the property becomes premium. In such situations, you’ll have to pay the charges even if you don’t want to.
#Super Area
• There are possibilities that the super built-up area mentioned in the agreement may change. Because it’s a tentative idea which can be changed during construction. But the cost of the property will be recalculated at the end after the confirmation of the final super area.
Also, if there will be an increase or reduction of the super area, buyers will have to pay or seek a refund respectively.
Though there will be no payable interest in both situations.
• It is suggested for you to be prepared for a 10% variation in the area during construction though builders try to stick to the plan. In case the area of your property increases, the cost will increase as well.
#Delayed Possession
• In case the company is not able to deliver your property within the time mentioned in the agreement, including the extension, the allottee can give it notice within 90 days of the expiry of the deadline for terminating the allotment letter.
• The developer will refund the money in case of delayed possession without any interest only after the property will be sold to the third party. Also, no timeline is given for executing the sale to a third party.
#Ownership Mode
• As per the policies of the hi-tech township of the Uttar Pradesh government, the land which is acquired by the government is on lease.
The buyer of the property, project or land has the option to get it on lease for 90 years, else90 years it into freehold which will require the buyer to pay the sale deed at the time of registering up to 12% of the sale price to the government.
In such cases, there are possibilities that the property agent may not give you this information in advance.
Note: If you are planning to buy such property, consider the cost of getting it converted into a freehold.
1 thought on “User guide to refer before buying a property”
Pingback: RERA - A complete summary for first time buyers