Note This Before You Enter A Joint-Development Agreement
As independent homes and villas give way for highrises, more and more developers and landowners are coming together for joint-development agreements. Is there something that you should take note of if entering such an agreement?
Read here.
Get the JDA registered
Any legal paper with terms, conditions and clauses mentioned is valid only if it is registered in the sub-registrar's office. This helps not just the landowner and the developer but also a potential buyer. Generally, it has been noted that people opt for the short-cut and get JDA's notarised or sign it on a stamp paper. This is the wrong way to go ahead.
Note the Supplementary Development Agreement
Not just the JDA, the supplementary development agreement needs to be registered too. This agreement could be a little different from what the JDA mentions and this is in no way wrong. However, it holds no legality if it is not registered.
Transferring the rights to family?
The landowner may want to transfer his ownership rights to a family member. This usually happens through a General Power of Attorney (GPA) and in such a case a landowner can request the homebuyer to transfer the money to the concerned family member with the GPA.
Buyers should also note that they are dealing with the landowner whose name is mentioned in the JDA as such a transaction is most prone to entertain benami transactions which can get both landowner and buyer into trouble. Also note that it is a buyer's duty to go through the GPA to understand the inheritance and how the land has passed on from one to another.
It is not a title transfer
The registration of a JDA does not mean it is a conveyance deed or a sale deed in favour of a landowner. If a buyer buys from a landowner on the basis of a registered JDA, he/she might fall into trouble given that the marketing rights of the flat are with the builder and he has the power to sell it anyone which the buyer from the landowner may not even realise.
If as the landowner you wish to sell, you would have to keep the Builder No-Objection-Certificate ready or be ready for a tri-partite agreement between the landowner, developer and the buyer. If the developer does not comply, buyers should keep away from the purchase.
No home loan with registration
A home loan by a reputed bank would not be sanctioned if the JDA is not registered. The developer may direct you to other non-banking finance companies which may or may not be the right way out. Do note that issues such as defect in JDA, fraud by landowners, unsanctioned loans may falter your home buying plan altogether.