FAQs on Buying Property

Q.1 What is the difference between freehold and leasehold property?

Q.2 What essential aspects should be kept in mind before purchasing a property which is registered on the name of a company?

Q.3 Which important documents should you check before buying a property?

Q.4 What papers and permissions should you check before buying a flat from a builder in a building under construction in order to get assured about the genuineness of the builder ?

Q.5 What are the legal formalities to gift a flat in a Co-operative housing. What about stamp duty?

Q.6 In whose name are the stamps required to be purchased ?

Q.1 What is the difference between freehold and leasehold property?
Ans. A freehold property consists of the house/building you are purchasing along with the land upon which it is built. The ownership in freehold properties is for an indeterminate length of time.

A leasehold property is that which consists of the house/building only but not the land upon which it is built. It is that form of property in which the holder of the interest has the right to use or occupy, but not to sell or transfer the property. The holder of the property occupies the property for a specified period of time. After expiring the date, the property holder has to return it to the person who owns the land.

Q.2 What essential aspects should be kept in mind before purchasing a property which is registered on the name of a company?
Ans. Before purchasing any property, you should verify from the Registrar of Companies that the property is neither mortgaged nor collateral security against any loan etc.

Q.3 Which important documents should you check before buying a property?
Ans. Before purchasing a property, you should look at the sanctioned layout plan, building plan, ownership documents, carryout search, etc. As all these processes are very hectic and requires a lot of legal probing, so it is better to contact an advocate so that he can advise you.

Q.4 What papers and permissions should you check before buying a flat from a builder in a building under construction in order to get assured about the genuineness of the builder ?
Ans. While buying a flat from a builder in a building under construction, you should check the following:

• You should check the approved plan of the building along with the number of floors.
  
  
• Be sure that the floor you are buying is approved.
  
  
• You should check that either the builder owns the land on which he is constructing or he has undertaken an agreement with a landlord.
  
  
• You should check that the builder is constructing without any violation of front setback, side setbacks, height, etc.
  
  
• You should check that specifications given in the agreement to sell of the sale brochure is entirely followed by the builder or not.
  
  
• Check the reputation of the builder.
  
  
• Ensure that urban land ceiling NOC, NOC from water and electricity authorities, NOC from lift authorities has been obtained or not.

Q.5 What are the legal formalities to gift a flat in a Co-operative housing. What about stamp duty?
Ans. Under the TOP Act, gifting of an immovable property is considered as a 'transfer'. In this case you have to register the transaction through a Gift Deed. The payment of stamp duty is to be done as per provisions of the relevant stamp Act depending in which state the property is situated.

Q.6 In whose name are the stamps required to be purchased ?
Ans. You should purchase the stamps in the name of any one of the executors to the Instrument.