Legal aspects to consider before investing in a home


Investing in real estate is considered to be one of the safest and most beneficial long term investment plans. Since the time of our forefathers, land is considered a valuable asset that we constantly strive to own. If you are someone who has never forayed into this sector before, buying a property can be an overwhelming affair.

 1. Verify the Title Deed

Title deed is one of the most crucial documents that legitimise the ownership of the property. A person cannot sell his property until the title deed is clear of any defects or shortcomings. You can search for the title deed at the Sub-registrar's office and verify the legal status of the property. The title should be free of any disputes, and you should ascertain that the builder fully owns the property. And Physically check the document under Builder's or Land Owner's custody to ensure the Property is not PLEDGED.

 2. Property Tax Receipts

The builder must pay the land tax of the property every financial year which ensures the correct extent, nature and title of the land. So when you are verifying the legal documents, don’t miss to review the land tax receipts. The builder must pay all the property taxes before selling a property. Failing which, you may become liable to pay the same. Thus, you as a buyer must ensure that all the taxes are taken care of by the builder before purchasing the property. One can gain access to all the details from the sub-registrar, where you can learn more about any legal dues or similar instances that might influence your purchase.


Encumbrance Certificate

The property that you wish to buy should be free of any legal disputes and dues. An Encumbrance Certificate is a document issued by the Sub-Registrar that reflects the encumbrance on the property. You can contact the Sub-registrar office to learn more about the legal history of the property. Upon request, you can get the encumbrance certificate of the property which will have details about all the registered legal dues and transactions. This could be applied and obtained online which makes us to ensure that the Land is free of encumbrances and this makes sure that the Property is free of any Encumbrances / Liabilities / mortgage. It is also a clear Title evidence Certificate.

 Sanctioned Building Plan

Many builders may give fake information about the developments of a locality to convince homebuyers. Any property must possess a sanctioned building plan approved by the regional building development authority to start the construction. This sanctioned building plan is issued by the authorities only after obtaining necessary documents from the developer, which is in compliance with the existing legal building norms. Make sure that you verify this document to avoid legal complications in future.

 Environmental Clearance

If the construction area is above 20000 sq.m., a clearance certificate from the Forest and Environmental Department of Central Government must be obtained. This is another important document to check before purchasing a property.

RERA registration

From 1st January 2020 onwards, all real estate developers are bound to register their ongoing and upcoming projects under the RERA (Real Estate Regulatory Authority) Act to ensure that the projects are in line with the current building regulations and laws. RERA registration is applicable to all projects where the land to be developed is 500 sq.m or more, and the number of apartments is 8 or more inclusive of all phases. All projects for which the occupancy certificate or completion certificate has not been issued are also required to get RERA registration. So if you are buying a new property, always check and verify the RERA registration number. All ongoing projects should be registered under RERA on or before 31 st March 2020 and all new projects should be marketed only after getting their RERA registration. Starting from April 1 st 2020 do not buy any property without checking RERA registration.

 Occupancy Certificate

Occupancy Certificate or Completion Certificate is a document issued by the local planning authorities to confirm that the building is constructed in compliance with the stipulated rules and is ready to be occupied. Without this certificate, a building is not considered as legally fit for use by tenants. We hope that this legal checklist will help you while searching for a new home in Bangalore.