Property Approvals Documents

If you do not have access to adequate information on legalities of buying a property, the consequence could be a harrowing experience! For instance, if the power of attorney isn’t in the name of the seller, or the legal procedures of the government are not met by the builder, then you might have to bear penalty; it could either be in the form of money or worse, lose the property itself.

Here’s a short guide on almost everything you need to know about legal terms and approvals associated with real estate.

Commencement Certificate

This is a document you need to look for if you wish to invest in an under-construction project. Legally, a builder cannot start construction before receiving the commencement certificate. A commencement certificate is like a permission letter issued to the developer by the local authorities like the municipality after inspecting the plans and engineering of the project submitted by the builder.

Completion Certificate

A completion certificate is a document awarded by the local authorities to the developer. It is a proof that the construction of the property has been completed, taking into account all the legal guidelines and safety norms such as enough space in the compound for an ambulance to turn around and a fire brigade to enter, earthquake resistant technology, etc. Absence of the completion certificate may lead to safety hazards as well as legal matters for the residents in future.

 Occupancy Certificate

OC, which is the acronym for certificate of occupancy, is another document issued by the local authority indicating that the construction of the project is completed in compliance with the laws and safety norms, making it suitable for occupancy. The main purpose of the OC is to state that the building is now in a legally habitable condition.

Clear Land Title

Clear Land Title is the expression used to state that the owner of the respective property owns it free and clear of any creditors. A clear land title is a title without any kind of imposition from creditors or other parties. If a house is on mortgage, for instance, it means nobody has a clear title to it; yet, the mortgage can be released if the mortgage holder is paid a certain amount. So, while selling the house, the seller will demand an amount that satisfies him and the mortgager.

Allotment Letter and Agreement

An agreement is a contract between the buyer and seller to legally record the purchase and sale of the house or property. It is a proof of the transaction that takes place between the two parties in accordance with appropriate laws.

Allotment letter is given by the builder to the buyer in case of an under-construction project. This letter includes details of the flat, all kinds of fees and charges to be paid by the buyer and payment options. Allotment letter is very important if the buyer wants to apply for a loan. The bank finances the property only after submission of the allotment letter.

Meeting legal formalities is very critical to purchasing a property, be it resale or under-construction. Now with a basic know-how of the legal terms and conditions involved in the process, you can confidently make a checklist before finalizing on your dream property!