Thursday 4 June 2015

PURCHASE OF FLAT


The apartment culture is of recent origin and has become very popular. This type of group housing is not alien to the human culture.Earlier people used to live on riverbanks in groups sharing common facilities.

Process of Purchase:
The Purchaser of a flat has to take into account the location of the flat, its proximity to civic amenities and also select the Builder according to his track record. It is always advisable to visit some of the projects completed by the builder before booking a flat.

Verification of the title of the property is one of the important aspects of purchase of property. Though the Builder provides Legal Certificate from their Advocate, the Purchaser should always independently get the title verified by his own Advocate. Only Advocates with a minimum of 7 years of experience are eligible to issue legal opinion for the apartment to the Developer as per the Karnataka Apartment Act.

If the property is sold by a General Power of Attorney (GPA) holder, verify the terms of GPA and whether the Owner who has given the GPA is surviving or not, should also be checked.

Validity of the GPA, Joint Venture and other Title deeds are most important factors that should be kept in mind. Agreement with the Developer should contain the Ownership details, sale price, payment schedule, Specifications of the construction, car parking details, undivided share of land, common amenities, Penalty clause for both parties, what are the other deposit charges to be deposited, Registration charges, whether Sales Tax is applicable or not, any other expenses etc., should be mentioned in the Agreement. Further, it must also contain the layout plan, sketch of your portion of the apartment, with specifications, date of commencement of construction work, date of handing over of the apartment, penalty for delayed construction and payment defaults, no escalation clause, guarantee for the quality of construction and construction materials used.

Conveyance/Sale Deed:
After completion of the apartment construction the Sale Deed should be executed by the Vendor of the land and the Promoters jointly as per the understanding. The Sale Deed must also mention the duties and responsibilities of the Buyer and the Seller, the Purchaser has to pay the required Stamp Duty and complete the Registration formalities. Registered Sale Deed is the main document that confers on you the Ownership of the flat. On the basis of the Sale Deed the Revenue Authority issues documents of title like the Khatha Certificate, Khatha Extract and Tax paid receipts.Price of a flat is determined, based on the various factors like location, specification of the work, carpet area and percentage of Super Built up Area.

Undivided Share of Land:
When you purchase an apartment you are entitled to an undivided share in the total land area. The undivided share depends upon the built up area of the apartment and the land area. As the total built up area increases the undivided share decreases and vice versa.

Share Certificate Method:

Purchase of the flat by Share Certificate Method is very popular in Maharashtra.  A Registered Cooperation Society acquires land, constructs flats which are allotted to its members; whereas in Karnataka, the Share Certificate Method is not accepted by General Public, Financial Institutions, State Government, etc. Karnataka Government is of the view that individual flats should be Registered by regular conveyance.  When tracing the title of this type of Share Certificate Method, verification of the Society Record, its Byelaws and Share Certificates is very important.

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