Know About Home Loans And How It Is Disbursed

This loan is available on:

  • Ready to move-in Houses and apartments
  • Builder floor or under construction apartments
  • Construction of a New House
  • On Your Plot
  • Extension of the existing house
  • Renovation of your house.

Benefits

  1. You get a lump sum payment and pay in easy EMIs for up to 20, or may be 30 years, which gives you more financial strength. If you are young, you can encash your future growth.
  1. The rate of interest is less as compared to other kinds of loans, either personal loans, or may be LAP or gold loans. These loans may be 1-2 % higher with fewer repayment years. They are stricter on recovery in case things go bad in the future.
  1. Hence, there are no repayment charges or tenure, so you can repay and free yourself.

 Risk Analysis Of The Project:

Builders’ financial stability, project viability, project land and title verification, all licensing verification.

Seller verification (In the case of real estate purchased for resale)

Paper verification, property title verification, and proper title verification, etc.

Why is the seller ‘s profile important even though he has no role after he sells his property?

  • Benami issue.
  • Property might be sub-judice under any legal obligation. Income tax fraud, loan defaults, attachments, etc.
  • The property is already mortgaged and the seller has not disclosed it to you.
  • Disputed family property.
  • The seller has a criminal background.
  • Anything that makes the title to your property unclear and could lead to future problems.
  • Tax breaks include a 10% rebate on interest paid on an IT return.

Now Next!!How To Check Your Eligibility!

Either get in touch with your bank, or any DSA, or you can simply use a loan calculator and put in how much money you want to pay per month. For how many years do you want to take a loan and how much is the current rate of interest? Better still, you should get in touch with your bank and DSA. They can better tell you such things. Considering other aspects like your age, profile, and Cibil score (last payment history (most important): 75% + Cibil Score out of 100)

That’s why it’s highly recommended that you never default on your loan or credit card bills, it may impact your loan eligibility.

Age is also very important when it comes to loan sanction, as the lower the age, the greater the eligibility because the bank considers your future growth.

Disadvantages

  • Sometimes you increase your budget and take on too much EMI.
  • Interest rates are floating, so if the rate of interest increases in the future, then EMI will increase or tenure. Can you bear the burden?
  • In a subvention scheme, the builder offers the buyer no payment till possession for a certain time. In these cases, the builder used your eligibility earlier, took payment from the bank, and has delayed the project for decades or may not have delivered yet.

Unitech South Park is one such example.

No EMI until possession or for three years

Unitech South Park sold its 100 units on a subvention scheme. They took 90% payment from the bank on the eligibility of the buyer, without even putting one brick on ground level. What happened, you know?

 

  • Builder is in jail
  • The project is nowhere to be found.
  • People are still paying the EMI
  • Because the builder only pays your interests, not principal, and secondly, if the builder fails to
  • Then the buyer has to pay it, as per the contract with the bank.
  • But now the RBI has banned down payment loans and subvention.
  • But what has happened is still agony.
  • So it is important, when you buy property on a subvention scheme to just check the actual payment plan on subvention.

Documents Required for Loans

  1. Pan and Aadhar Cards
  1. Address proof
  1. Income proof
  1. Bank statement for 6 months
  1. Salary slips for the last three months if you are a professional
  1. IT returns for 2 years or 3 years.
  1. Proofs of business address and business existence proof for self employed
  1. CA certified balance sheet for 2 years.

What Are The Major Steps Of A Home Loan?

1) Pre-Sanctioning

2) property legal

3) Disbursement

 Now Start With The Pre Sanction.

As per your income profile, the bank reviews whether you are eligible to pay such EMIs based on your income or not. While sanctioning the amount, they did not consider auctioning a property to recover the home loan.

On home loans, banks cannot take risks of defaults. It’s a very tedious and time-consuming process for banks to take back the pledged property and auction it. Sometimes it may take years or even decades or may even fail to do so.

Hence, even if you have a property worth 1 CR and you want to take a loan of 20 Lacs. They will strictly monitor your eligibility to pay 20 Lac.

The bank may reject the loan if your income statement fails, even though it is very safe for the bank because the property under mortgage can easily help them recover their dues.

The major reason for doing so is that it is not easy for banks to recover the property so easily. It will take years and years of legal battles. It doesn’t work like a car loan, where they will just tow away your car in case of payment failure, or a gold loan, where they can easily liquidate your gold.

This is the major reason car loans are the easiest loans. Even loans against property or personal loans are easy.

A loan against property, or LAP, is different from a home loan. Here you mortgage registered property and take out a loan. The rate of interest for LAP is higher than a home loan.

The margin amount may help you but not much, because some NBFCs take the risks but not seasoned banks.

Secondly, you may be a big Lala and hold too much property here and there and earn in black, but still your valid income profile doesn’t show that you may be able to pay that instalment. They may reject the loan.

For example, if a person earns too much in black but doesn’t show any income on paper, the bank considers only paper income.

Sometimes banks have some blacklisted areas where they don’t like to offer loans, like Jamia Milia. Based on past records of the area.

The type of job or profession they have also plays a role in determining their eligibility.

For example, banks keep police professionals, lawyers, and even real estate agents on a negative profile list.

The bank prefers a more stable income. Some professions 

They are not likely to fund a case where income keeps fluctuating. In certain periods, you earn more or a certain person less. They don’t believe in average income, hence if you are a part of this bank, they may not fund you or may fund you for a lesser amount.

If you are salaried, they also consider the profile of the company, you are working for.

Maybe you earn less on salary and incentives! The bank may still be concerned about funding.

The Cibil score also plays a major role.

Your past defaults can always haunt you and your eligibility score. A 5000 rupee credit card default can dampen your hopes for a 1 CR home loan. So, please pay all credit card bills or EMIs on time.

You have previously settled any bank loan on a lower amount. It may hamper your eligibility score. There may be a lot of other concerns too.

The next step is Legal

Project Funding!! Or project approval.

Many times, when you go to buy a property, the builder tells you that these banks are empaneled for funding here. In this case, the empaneled banks have approved the project. Project approval has become more important if it is under construction.

List the verification steps that banks take to approve the project they are funding

  1. title of the project land.
  1. All government and authority approvals, i.e., maps, floor plans, RERA Approvals or any other kind of approval based on state, city, municipality, geography etc.
  1. Financial Health of the Builder (most important)
  1. fund flow and cash flow to ensure the project is not halted or struck.
  1. Project viability and other funding on the project, like the builder might have taken a construction loan. They will also check the viability of it.
  1. Sometimes they also consider a certain level of exposure to a builder or a project.
  1. For example, HDFC stopped funding of (Spaze privy) on the grounds that now our exposure limit has been exhausted, it’s just putting all our eggs into one basket.

Sometimes a project may be approved by one bank but may not get approval from other banks. Different banks have different frameworks.

The approval takes a minimum of 2–6 months. As a result, it is always advisable to obtain a loan only from the bank that approved the project at the time of purchase.

As an individual, you should only know that the project is approved, because the bank will only fund that property if the project on which it is built is approved.

In the case of resale, the seller’s verification of documents is sufficient.

Disbursement: It is now a long topic to discuss!

So first, we should know what kind of transaction exists in the market when you buy a property.

  1. You are purchasing a property that is still under construction from the builder.
  1. You are buying a ready-to-move property from the builder.
  1. You are purchasing a resale property that is still under construction.
  1. You are buying a ready-to-move registered property in resale.

These Are The 4 Major Cases To Discuss For Title Transfer From Seller To Buyer.

Case1:

Suppose you are buying an under construction property from the builder.

Here you simply fill in an application form to buy a certain property at certain rates, with certain payment plans, certain unit numbers, etc.

Now to make this more practical, you are buying DLF Independent Floor, Sector 92, Garden City at DLF. Then you know the property is under construction.

Payment plan 

Let’s suppose the booking amount is 10 lacs. The payment is as follows:-

  • 10% in 15 days
  • 10% after 2 months of booking
  • 10% ON 4 Months
  • 10% 6 Months
  • 30% On super structure
  • 10% On application of OC
  • 20% On handover or possession
  • Now the registry and all that follows afterwards

Now, suppose, the buyer’s name is Ram, and he booked a unit in DLF Garden City Floor at 1.5 CR.

DLF has offered the payment plan stated above, and they will deliver it by June 2024, exactly 2 years from now. So, he filled in an application form with a booking amount of 10 lac. Hereafter,

  • DLF CRM will send him a payment receipt of 10 lacs, an allotment letter, a builder buyer agreement and a fresh demand to complete 10% payment.
  • Copies of the Builder’s buyer agreement

(Builder buyer agreement carries points related to the terms and conditions of this deal.

Ram has now completed the balance of the 10% payment. After completing 10%, BBA will be re-registered in court. It’s now compulsory and you can’t skip it.

Hereafter, BBA is executed and ram is ready for a fresh instalment via VIA Bank (may be HDFC).

Please Note 

  1. A) According to RBI guidelines, a home loan is worth 75% of the property’s value.
  1. B) The bank requires buyers to pay their contributions first, then their contributions.

There may be some exceptions where the bank offers more than 75% and may disburse on a prorated basis.

Now, pay attention to Ram!!wants to grab maximum funding of 75% value, which comes to 1,12,50,000/- He is now eligible to get the loan from HDFC and the best part is HDFC has already approved this project.

Secondly, he needs to submit his property documents for legal review. He needs to submit all the documents in photocopy received from DLF, i.e. payment receipt, allotment letter, and builder buyer agreement, along with an account ledger from DLF, which also confirms all his payments.

The Bank People Will See All The Original Documents For Sure

Now he will have to get a permission to mortgage letter from DLF. This is required because DLF is still the rightful owner of the property and Ram is just a nominee or an allottee.

As per the procedure, he will send a copy of this sanction letter to DLF and an application to request the same. DLF will issue his bank this letter.

The bank is now ready for disbursement. Before that, Ram needs to sign a loan document from HDFC, which is again an agreement between HDFC and Ram.

Once all is done, HDFC is ready for disbursement.  Now first 25% Need to be paid by Ram balance whenever DLF raises demand, Ram will send this letter to the bank, and then the bank will pay it to the builder.

At the same time, at the time of disbursement, the bank has already taken all original documents issued from DLF and kept them in its own custody. The bank issues Ram a letter confirming the same.

Everything is normal in terms of the project being completed on time in July 2024, and DLF only offers possession after receiving 100% payment. few days and months, DLF will ask for the registry. And you will take the registry. Again, the original registry copy, which is a conveyance deed, will be taken by the bank.

Now since its life and scenario changes So we are here to discuss all the scenarios.

Now we go back around 1.5 years of Ram’s booking around Dec 2023, and Ram plans to sell the property, and he gets a buyer of around 1.80 CR, named Shyam.

By the date, Ram has already paid 70%, which is on superstructure, i.e. 1.05 CR. The bank has paid 75 lacs and Ram has paid 30 lacs from his own pocket.

So an agreement to sell will be made between Ram and Ramesh. Here is a draught of an agreement to sell, as you can see.

Calculation:-

Total deal -1.80 CR

Ram purchase from DLF – 1.50 CR

Rams profit 30 lac

Paid till date 1.05 CR

Due with the builder 45 Lac

Paid by Ram himself 30 lac

Paid by bank 75 Lac

Ram received a total payment of Rs 1.35 lac (PAID+PROFIT).

Ram needs to repay the loan and get all the original documents released from HDFC and be free from all kinds of mortgage.

So, we see 3 Possibilities

  1. Ram does have a loan of 75 lac rupees, which he can easily repay.
  1. Ram doesn’t have money to replay, so Ramesh will pay this money to Ram so that Ram can pay and release his papers.
  1. Ramesh will take the loan from the same bank, which is HDFC, and take over the loan from Ram.

First and third policies are more common in Gurgaon, because the buyer does not want to pay so much extra money before transfer, which could put him in danger if Ram has malicious intentions.

  • The major buyer also has to take the loan, so he can’t pay him so much in advance

Now we’ll look at the case.1

Ram does have 75 lac rupees. He can easily repay his entire loan. Just see the draft.

Ramesh will sanction a loan amount of Rs 1,35,00,000/-

The deal will now be as follows:

Ramesh paid Rs. 15 lacs at the agreement to sell (Rs. 100 stamp paper), and Ramesh took photocopies of all DLF documents and deposited them with the agreement to sell and account ledger of the unit on the agreed date.

Part legal is done, and after the bank verifies its original documents which Ram has received, the bank will do the final legal but for a few documents more before disbursement.

  1. NOC to transfer (DLF) will give a NOC to transfer certificate to Ramesh bank that DLF does not have any objection to transfer in the unit from Ram to Ramesh if all conditions of transfer are fulfilled.

Once it is done, Ramesh signs all the documents with the bank, and the loan is ready for disbursement.

All three Rams, Ramesh, and the banker will arrive to transfer documents and sign all relevant documents. The bank will pay its 90 lac, and Ramesh will pay 30 lacs out of his own pocket. Ram will submit its original documents to DLF for transfer, Ram will also pay transfer charges if any or any kind of interest or penalty.

Once all the formalities are done, the endorsed original documents will be received in 15-20 days, which you need to submit to the bank, or the bank will collect them directly from DLF.

Another important point is that the documents are not altered; all receipts and the BBA allotment letter remain unchanged, but are endorsed in the name of the second party.

Generally, you will find an endorsed stamp on the back side of all receipts, allotment letters, and a page in the indorsement page in BBA.

All future instalments will come to you, and all teams and conditions will be applicable to you.

Case 2:

Again, Ramesh pays this amount to Ram, which is Rs. 75 lac.

Hence, the bank will pay the balance of Rs 30 lac to Ramesh at the time of transfer

Then property is transferred

Case 3:

Ramesh will take the loan from the same bank, which is HDFC, and take over the loan from Ram.

Banks have a facility for intra bank transfers.

Ramesh will take over the loan from Ram. The same loan will be shifted to Ramesh’s account,

Here the transaction will be as follows:

Paid at ATS by ramesh15 lac

Loan transfer 75 lac

The bank will pay an additional 20 lacs to Ram at the time of transfer.

Ramesh will pay 25 lacs to Ram.

A transfer will be made.

Finally, the bank always likes to contribute.

Hence, it always wants you to release your 25% first.

Now we will discuss cases 3 and 4.

Ready to move in, purchased from the builder.

Ready to move in. Purchased on resale

Case 4:

Ramesh buys DLF’s independent floor at 2 CR directly from the builder in 2024 Dec. The case is that when you buy a ready to move property in DLF Garden City floor from DLF, the builder sometimes is left with some unsold inventory, so they sometimes hold it to sell after it is ready to move in.

Payment plan

10% Booking amount- 20 lac

10% Within 10 days 20 lac

80% Within 60 days (possession)-1.6 Cr

In this case, Ram goes straight to DLF and fills out the application form.

DLF will send him a payment receipt for the booking amount and allotment letter.

Copies of the builder’s buyer’s agreement and a fresh demand of 10 %.

Ramesh now goes to the bank and obtains a 1.5Cr loan sanction.

Ramesh pays the first 2nd instalment by himself.

At the time of the last installment, the bank will pay its 1.5 CR and ask Ramesh to pay its balance of 5%, that is 10 lacs. The bank will collect all documents in original.

Generally, the builder takes 100% at the time of possession and does the registry 1-2 months later.

In this case, the bank guarantees that you have purchased the stamp paper so that you can’t skip registry in the future. Once the registry is done, the bank will take its original registry copy too.

Case 4:

It is now ready to move or a resale

In this case, again, Ram, whom you will have met earlier

Suppose he had not sold his property earlier and wanted to sell around 2030 when it was ready to move in. All his paperwork has been done. He was happily living suddenly and wanted to have a larger house and sell his existing property.

In this case, Ram bought it from DLF for 1.5 crores and is now selling it for 2.5 crores.

Now take it for granted that Ram has a due amount of Rs. 90 lacs from the bank. Hence all his documents are mortgaged.

List Of Documents Which Ram Or His Bank Has

  1. Allotment letter & builder buyer agreement
  1. Possession letter
  1. Registry (Conveyance Deed)
  1. Mutations

These documents will be deposited with the bank, HDFC.

Now Ramesh has come to buy this at 2.5 CR

Ramesh gave him a 10% AT Agreement, which is 25 lac

We assume that Ramesh has applied for a loan and got a sanction amount of Rs. 2 Cr. In this case, again, if Ram has funds, he will get his original documents released, or Ramesh will fund in advance of the loan takeover.

Instead of the transfer registry being done at court, the bank will hand over his chq to the seller at court after the registry. The bank will take all past documents for Ram that day, including his registry copy and new registry when it comes.

Please ensure that you will get all the necessary mutation documents signed at the time of registration. Take all the past documents from the seller in case no bank is involved. If you have not done so, then in the future (apke apartment mai kabhi laon nahi hoga), neither bank will fund a new buyer in case you sell.

Chains Of All Documents Are Required By Banks

1) Payments receipts

2) Allotment letter

3) Builder-Buyer agreement registered with RERA in case the property is subject to RERA (some older properties are not subject to RERA).

4) Account ledger issued by the builder’s accounts department for said property.

5) Permission to mortgage, as the actual owner is the bank and the unit holder is just an allotee, So, the bank needs the permission of the builder.

6) If the project is being funded by a bank, the builder may have taken out a construction loan. In this case, the bank may also need an NOC from the bank too.

7) The bank, builder, and buyer signed a tri-party agreement.

8) Before disbursing their portion, the bank requires a minimum of 25% self-funding.

Hence, the bank statistics disbursing the payments as demanded by the builder from time to time. As an owner, you need to send your demand letter to be raised by the developer. The bank will keep releasing the payment till possession.

Once the project is completed, the bank will ask the buyer for the registry! Once done, the bank will take the original registry copy into their custody along with the original documents.

The bank also keeps all original documents and the documents stated above once issued by the builder at the time of disbursement.

Next Seller Verification, in case of resale or else, transaction directly from the builder.

Under Construction Project

Then a bank requires

1) Receipts for payments

2) Letter of allocation

3) Builder buyer agreement registered with RERA in case the property is subject to RERA (some older properties are not subject to RERA).

4) Account ledger issued by the builder’s accounts department for said property.

5) Permission to mortgage, as the actual owner is the bank and the unit holder is just an allotee. The bank needs permission from the builder.

6) If the project is funded by a bank, and the builder has obtained a construction loan, the bank may also require an NOC from that bank.

7) The bank, builder, and buyer signed a tri-party agreement.

8) Before disbursing their portion, the bank requires a minimum of 25% self-funding.

Hence, the bank statistics disbursing the payments as demanded by the builder from time to time.

As an owner, you need to send your demand letter to be raised by the developer. The bank will keep releasing the payment till possession.

Once the project is completed, The bank will ask the buyer for the registry! Once done, the bank will take the original registry copy into their custody along with the original documents.

One thing you should know is that the bank keeps all original documents and the above-mentioned documents once they are issued by the builder at the time of disbursement. Now you will also wonder what happens if the builder directly gives the registry to the owner and moves away.

The builder can’t do that as the builder is also bound by a Tri- party agreement which is done by the bank, builder, and buyer. Hence, when you are taking the registry, the builder asks you to again take the NOC from the bank. At the time of registry, the bank lawyer comes and he directly collects the original registry from the court.

In this case, the property is ready to move into and you purchase it from the builder. In this case, when you come to buy, the builder offers you some payment plan like

10% at the time of booking

10% in another 15 days

5% in 45 days

And the balance on possession, which may again be 30 days

In this case,

After you book, pay 10%.

The Builder will send your payment receipt, allotment letter, and Builder buyer agreement.

In the case of a RERA builder project, you will sign and execute a BBA in court, which stands for RERA Registration of Builder Buyer Agreement.

Bank after sanction has been done, the bank is ready to release their contribution. When the builder issues the final demand letter and offer of possession, the bank will pay it to the builder by keeping the original documents with them.

They will also take the original possession letter, and, in case there is a time gap between possession and registry, the bank will ask the buyer to buy stamp paper and take an email from the bank that registry will be done before this many days.

Once the registry is done, the bank will again take the original registry copy and conveyance deed with them. The conveyance deed is a sale deed first registered and is referred to as a conveyance deed. The successive registries are called “sale deeds.” Now you can buy it on resale and it is under construction.

Here, Document Requirements Are

Before that, you need to know how resale transactions take place.

Suppose Ram is a seller and Ramesh is a buyer. In this case, after finalizing the deal, Ramesh gives a token amount and then they make an agreement to sell on Rs 100 stamp paper duly notarized. The agreement to sell has all the major points about the deal, i.e.

  • Total Value of the transaction
  • Total payment time
  • Penalty in case of breach

Now, since Ram is selling an under construction property, it is likely that some payments are also due to the builder.

And the actual purchase of Ram may be higher than what he is selling to Ramesh.

Now just take the example of Emaar Digi homes, where Ramesh purchased a 2bhk at 1.5 CR and sold it at 2 Cr.  In this case, Ramesh is asking for a premium of 50 lacs.

Now, if we look at Ram’s transaction with Emaar,

He and the builder have agreed on a price, say, 1.5 crore.

example Emaar has asked for 70% payment till date.

In this case, Ram has paid 70% of 1.5 CR i.e. and the balance of 30% is due (may be to make it simple, the builder has asked for it on possession).

Now, in this case, the agreement to sell will be

2CR in total sales value

1.5 CR was the original allotee purchase value.

RAM paid the builder a total of 1.05 CR.

The total amount owed is 45 lac.

Ramesh needs to pay 1.05 CR+ 50 Lac to RAM.

That is 1.55 cr.

Ram has taken a loan disbursement of Rs 50 lac till date and needs to pay 45 lacs to the builder whenever it is demanded by the builder. Now we come to case number 2, where Ram took some part of his payment through the bank.

So, now Ram needs to clear his dues with the bank and take a NOC and no dues certificate from the bank and take back its original documents, like allotment letters, payment receipts, and executed builder buyer agreement.

The builder needs all such documents in original at the time of execution of the transfer from Ram to Ramesh. If Ramesh has enough money with him, he can simply deposit it in the bank and close his loan.

Now comes a critical case where Ram doesn’t have the payment to pay the bank and close his loan. In this case, either Ramesh will pay Ram that amount and Ram can get all his papers released.

But now when Ramesh thinks he should not pay this much, he feels it is risky to pay more money, to make the deal riskier. In this case, Ramesh has only one option left, which is to take the loan from Rams bank.

Now we have two aspects to discuss. Either Ram will choose scenario 1 or 2, or Ram will choose scenario 3. In this case, you can select options 1 and 2 or 3 and 4 for a loan sanction amount of 1.50 CR.

Suppose the transaction was

At the time of the agreement, 20 Lac was paid

Now Ramesh has decided to pay the balance of 1.35 CR to Ram at the time of transfer

Hence, the bank will come up with a DD of (1.50 CR less the balance due to the builder, that is 45 lac) i.e. 1.05 CR

And a balance of 20 lac will again come as DD to the seller

Now you will think that the seller has earned 50 lacs! But the seller has to pay a transfer charge of Rs 100- 200/ Sqft to the builder + GST. In this case, it may be 1.5 lac + GST of 18%.

Along with it, any penalty or interest due the builder is paid at the time of transfer. The Builder system doesn’t execute transfers if any amount is due or any instalment is due. Sometimes we do a transaction where some installments are also due.

If instalments are due, then (uska bhi DD bank bana kar lata hai) at the time of transfer. In that case, if Ramesh had given more payment just to facilitate loan repayment, then Ramesh could have paid a lesser amount.

Case C

(Jaha bank loan nahi hua advance mai.) In that case,

Ramesh will get sanction from the same bank as Ram. Now there is an internal process of loan transfer. That means the same loan account of Ram will be transferred into the name of Ramesh.

In this case, the bank lawyer will come with the original documents to the builder’s office at the time of transfer. In this case, the payment will be:

20 Lac at the time of Agreement

50 Lac as a loan transfer

Balance DD of Rs.

Ramesh sent Ram a Rs. DD at the time of the transfer.

The documentation procedure will remain the same. Ram is the only exception. loan can be taken over by Ramesh. It is a condition of intra-bank transfer. But it can only be done for the same banks. Banks don’t do this with different banks.

Another case where property is ready to move-in is property in Regal Garden, 4bhk, sale value 1.80 CR, Registry done. Ram (Seller) is in possession of everything.

Now we have the following example:

1.80 CR total sale agreement

Ram has a loan of 80 Lac

The payment is 20 Lac

The remaining balance is one CR.

The builder no longer requires transfer permission or mortgage permission because the builder has given you registry and his ownership is no longer there; you are now the absolute owner.

The only builder or its maintenance team is here for mutation.

Now in this case,

Case 1:

  • Documents requirements
  • Rams Allotment letter
  • Rams builder buyer agreement
  • Rams possession letter
  • Rams Registry copy

This utility bill is in the name of Ram for the said flat. (This process is important to check mutation has been done. It is a formal post registry where all utility bills are transferred in your name. This looks small but is very important. Because in the past, many people have made this mistake now. Instead of having the registry, their title is not clear. And their past seller is not signing the relevant documents, or the actual person authorized to sign is no more. So the most important thing is that at the time of registration, mutation mai sare documents seller ke sign ho jaye.

Possession Letter

6) Registration (transfer deed)

Now you will wonder how the builder will offer me a possession letter or registry when I haven’t paid my full and final payment, because on one hand, the bank is asking for all the documents. Hence, in this case, the bank will ask you to pay your contribution and ask the builder to raise the demand, for further payment. Will you pay it and later collect the possession letter and registry, if the builder’s profile is big? If the builder’s profile is not so big, then the bank will hand over the DD for full and final payment at the time of registration. In this case, the bank lawyer comes with a demand draft at the time of registry and comes with the DD in the name of the seller, and once all the formalities are done, he hands over the DD to the seller.

In The Case Of Bookings, It Only Comes Under Project Approval

1)  Original Documents Verification of All Documents Issued by the Builder to You

If it is U/C, certain documents, such as a possession letter, are added if the project’s occupation certificate is received. In the case of re-sale, they will verify all such documents of the seller because the same title of documents is to be endorsed.

2) They now require KYCs and other information from the seller. Pan card, Aadhar card, address proofs, and so on. They need to know the person is authentic, it is not a benami, or maybe the seller has a clean background. For example, in the past, the bank didn’t clear the legal of a very big meat seller. because he has some criminal records. If some criminal is selling the property and the banks come to know, they may reject the legal. If you are directly buying from a builder, then these come under project approval, so it is already done. You don’t have to worry now.

3) They also need to know about the transaction, so they need the original agreement to sell between the buyer and the seller! They must know how much you paid and how much is owed to the seller and builder if the house is still under construction! If you live in Haryana, use Rs. 100 stamp paper; other states have different stamp values.

4) They require a no objection certificate from the builder in order to transfer title from buyer to seller. Because sometimes the builder has stopped the transfer of the property for certain reasons, or the unit might be on hold due to non-payments, and the builder wants the seller or present owner to pay and settle all its dues at the time of transfer, or the unit is under conciliation, or the builder has got a stay order from court to either do any title transfers or any flat, or this flat. Sometimes people take a stay order from the court to sell the property in the case of a family dispute or may be divorce related issues. Sometimes the court directly sends the stay order to the builder to tell them not to transfer the said flat or The current seller may be involved in a legal battle with the builder in RERA court, the Economic Offence Wing, or any other court. In these cases, the builder first expects the seller to give him a case withdrawal letter with NOC from the subject authority.

When you opt for NOC, the builder sometimes issues a conditional NOC mentioning that these are the conditions to be fulfilled only in this case. Then the NOC is valid.

If the existing owner has already taken the loan from the bank and the property is mortgaged, the builder will ask him to bring an NOC from his bank, indicating that he has replayed to the bank and no dues are outstanding, and the bank has no objection to releasing the mortgage. the builder can offer a conditional NOC.

5) Second, mortgage approval. Because until and unless the property is ready to move and the registry has taken place, The builder is the real owner and the title holder is just an allotted or a nominee of the property. So the builder needs to give permission to mortgage. If the project is funded, then another NOC from the funding bank may be required.

In the case of being ready to move in, certain documents are changed.

6) In the event of a resale

In the case of resale, they consider the profile of the seller

 

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