Read More Into Your Sale Agreement

We will not be exaggerating if we said today's buyers are more aware ― their current passive approach towards the real estate market is a clear sign of that. The property boom in India that lasted for about two decades suddenly went into a spasm starting 2014, as buyers realised it might be, after all, not worth the pain. Projects delays became the order of the day; fly-by-night developers were in plenty; an atmosphere of utter chaos prevailed, testing buyers' patience. These rough times taught all of us the importance of being aware of our rights and duties as buyers.

As they slowly make a comeback, they are more careful with the paperwork now. For instance, a buyer now knows that while preparing the sale deed ― the mother of all legal documents that narrates the terms and conditions ― he must insert a clause that makes the seller responsible for paying a penalty in case he does not deliver the project on time. The buyers will most certainly ask his lawyer to add an indemnity clause in the agreement which would state that in case a proposed project is caught in a legal dispute, the developers will duly compensate the buyers. This buyer would also insert a clause in the sale deed that would bind the developers to respect all his promises.  You are on the right path, we must say. But, you also have to read into the various clauses that the seller might have inserted to guard his interest.

Here are certain other points for you to consider.

Rights to admission are restricted

Suresh Rana bought a resale flat in Delhi. But, when he wanted to visit the property for a third time to show it to his family members, the seller, who still occupied the property, told him he does not have the legal right to do so till he made the full payment for the property. The sale agreement had a no-access clause.

You get what you see

When Ragini Nayak asked the seller to fix certain defects that she found after she had paid the earnest amount to the seller, she was informed that the latter was not liable to do any such thing. The property was sold to her on a “as it where is” basis and the same was mentioned in the sale deed.

Where is the proof?

Rohit Goyal bought an under-construction property based on a construction-linked payment plan. Owing to never-ending delays, Goyal now wants the developer to return the earnest money, along with certain additional charges that he paid to the developer. While there is a clause in the sale deed that states that the developers will have to pay a penalty in case he defaults, there is no clause that states the additional payments Goyal made to the developer.

Pay if you transfer

In most cases, if you buy an under-construction property, the sale deed would invariably have a clause which would assert that you pay a penalty to the developer if you transfer or lease the property to a third party before a housing society is formed.

Silence is not always golden

Typically, a seller/developer is liable to pay all the taxes till the time a property is registered in your name. So, as a buyer, not only should you make sure that the seller has paid all the dues but also see to it that the sale deed has a clause in this regard. In case the sale deed is silent on this, you may end up paying the outstanding dues such as water, power, utility bills and property taxes, etc.