• Know your builder through his projects. Points to find out about your builder.
• His previous projects
• His reputation with other business associates
• Achievements
• Whether he offers timely possession

Housing Finance And You

Keeping the following criteria in mind, check which Housing Finance Institution (HFI) suits your needs.

• EMI (Equated monthly installment) – The amount and the number of installments.
• Interest rate and its computation on total loan amount, on reducing balance or whatever other method.
• Processing fees and any additional charges.
• Need for guarantors.
• Processing time for loan approval.
• Repayment period and pre-payment charges, if any.
• Loan amount approval. This is usually 3-4 times the annual income of the household
• HFI’s service centre network.

Intricacies

• Title
• Approval from various authorities
• Amenities
• Possession time
• Occupation certificate if the building is ready

Check Them Out

It is important to check a few things before getting into any deal, financial or otherwise with the builder.

• The area of the flat
• Quality of construction
• Project approved by housing finance companies
• Additional charges

Detailed Examination

While finalising the deal

• Agreement of sale

Ensure that the ‘Agreement of sale’ is drafted as per the requirements of Maharashtra State Ownership of Flat Act (MOFA).

• Annexure to the agreement of sale

  A complete ‘Agreement of sale’ contains relevant title certificate, IOD, CC, list of amenities, copy of plan, etc., as annexure.

• Payment terms

  Make sure that the payment terms are linked to the progress of construction work.

• On finalisation of the deal:

  a)    Stamp duty – Stamp duty is something like sales tax, payable by the buyer. It varies from state to state.

• Calculation of stamp duty (Maharashtra)

  a)    Assess the value of your flat based on the location. This detail could be availed from the ‘Stamp duty ready reckoner,’ and obtained from the Registration Department.

  b)    The stamp duty amount is calculated on the market value of the flat and not on actual agreement value.

The stamp duty is applicable on the market value or agreement value, whichever is higher.

The following table will help you estimate the stamp duty amount.

• Registration

  The agreement on which you have paid stamp duty has to be registered with the Registrar’s office by both the buyer and the seller.
  The current registration charges are 1% of the agreement value or Rs.20,000/-, whichever is higher.

Buying A Flat In Resale

• Verify original agreement for sale and registration receipt.
• Verify whether stamp duty is paid as per market value or not.
• Verify whether flat is free from all encumbrances.
• Verify original share certificate.
• Letter of Intention to the society from seller.
• NOC from society / builder for registration.
• Get transfer papers signed by seller and accepted by society.
• Obtain 230A certificate from seller in Form 34A prior to registration.

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