Corona crisis and stay at home – check your property documentation!

Corona crisis and stay at home - check your property documentation

Did you ever think that in the 21st century, there would be a time when the whole world would have to battle a tiny virus that holds the entire universe hostage?

As you stay safe and protected within the four walls of your homes, do pause and spend some time taking stock of whether your documentation of property affairs is up to the mark or not.

Whether Corona persists for a few weeks or holds us under threat for a few months, remember – your assets will stay yours only if you are particular about the detailed documents and other aspects.

Therefore in this time that you stay at home – whether you are working or not – please spend some time going through all your property documents to ensure that they are complete and credible.

Meanwhile, even in this crisis, NRI Legal Services remains connected and open to all its clients – existing and potential.

As a global legal management firm, handling crucial property matters we are constantly aware of the responsibility we have towards our clients across the world.

We have an exceptional record of delivering legal services for issues related to the immovable and moveable assets of NRIs. Besides providing justice to NRIs who are facing problems in property legal issues, it is our endeavour to reinstate faith in people residing overseas.

Our competent team of lawyers is capable of providing consultation to clients. All legal advice is given after complete reviews of all documents. An exceptional communication service network is used to give legal advice to clients.

NRI legal services step forward to provide a range of services to resolve issues related to the following – Title Search, Partition of Property, Transfer of Property, Banking And Finance matters and Tax Matters. Besides these, we can help you find solutions to any matter related to Succession Certificate, Adverse Possession, Landlord Tenant disputes and Real Estate Services.

We would suggest that all the time that you are now getting to be at home should also be used to sort out your personal and official documents. Topmost priority has to be your documentation on property.

Ask yourself – are all ‘Will’ related matters sorted out? Do you anticipate any issues regarding the partition of property in your family?

Do ensure that transfer papers and succession certificate complications are kept into consideration and you are aware of what the procedures are.

Our teams are working round the clock across various cities, well connected and in sync with each other to resolve all your queries and issues.

NRI Legal Services – at your service, all the time and through all crisis. Trust us to be there to make your life easier and smoother.

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Importance of Due Diligence and Title Search before Property Purchase

Importance of Due Diligence and Title Search before Property Purchase

Due diligence and title search play an important role in real estate/property transactions.  People approach us and often have the following queries.

What is due diligence and Title Search before property purchase?

It means taking all precautions and ensuring that investment in a property is safe and secure.

By exercising due diligence:

  • The buyer identifies and evaluates all types of risks involved in investment
  • The buyer tries to rule out/minimize these risks

How do we go about it?

Due diligence implies:

  1. Scrutiny of title:

Title Search relates explicitly to the search for ownership and the rights of the owner to sell the property. Two kinds of title search reports are there.

  • Full Search – The title of the property is searched for a period of previous 30 years.
  • Limited Search – The title of the property is searched for a period of previous few years (less than 15 )

The search report is prepared depending upon the nature of the transaction. The title search is a very crucial part of due diligence as the defective title leads to no transfer at all.

Also Read: What is a Sale Deed? Legal Importance and Registration Process

B. Search for the right of the owner to sell the property:

The owner must be capable of transferring ownership. The buyer has to ensure that there is no restriction to the power of alienation of the owner. The limitation can be there:

  • If the owner is a minor or a person of unsound mind. Such a person can sell through guardian or a person so authorized.  
  • The owner is not having an absolute right in the property.
  • The owner is a lessee or a tenant.
  • Statue does not permit sale of the property.

Read More: 13 questions an NRI must ask to find lawyer in India

Which records are searched?

  1. The records maintained
  2. at Sub Registrar’s office
  3. with Tehsildar (mutation and Jamabandi)
  4. records maintained by Registrar of Companies
  • Title deeds – Gift deed, Will, Lease Deed, Sale Deed etc

 What is the significance?

There are many reasons to exercise due diligence before purchasing a property:

Also Read: How to cancel Illegal Registration of ancestral property

  • Increase in the number of frauds – There has been an increase in frauds related to real estate. Due diligence involves verification of documents, title and ownership rights to ascertain the authenticity of the same and therefore, helps to prevent fraud.
  • Cost of investment – People invest hard-earned money or a huge amount of loan in real estate. Due diligence is required to safeguard the funds being invested. As stated above, risks are identified, evaluated and minimized by due diligence.
  • Disputed property – Before buying a property, buyer has to ensure that the property is not involved in any litigation. If there is any court case pending concerning the property or the rights of the owner, it can pose hardships later for the buyer. The buyer is bound by the decision of the court, which may or may not be favourable. 
  • Encumbrances which affect the value of the property– The property intended to be purchased must be free from all types of encumbrances like
    • Mortgage
    • Lien
    • Charges due (utility bills, tax payment or any other statutory payment)
    • Litigation

A certificate in this regard is issued by the Office of the Sub Registrar. The buyer must inspect the original title deed as it is deposited with the Bank if there is any loan against the property.

Also Read: What To Do If Your Property Possession Has Been Delayed?

  • Easement Rights/ Acquisition process affect the interest of the purchaser: The property might be having
    • an easement right (right to have a passage through the land)
    • covered under acquisition scheme of the Government.

The buyer must check for the same. It affects the returns from investment.

  • Necessary Approvals – A buyer must ensure that the owner has obtained necessary approvals from the authorities. Approval is granted if the statutory requirements have been fulfilled. 

LEGAL ASSISTANCE

It is advisable to get legal assistance for the search of records and verification of documents.

Effects of Family Disputes on the Partition of Property in India

Effects of Family Disputes on the Partition of Property in India

Family disputes can lead to a forced partition. Partition of property takes place when there is joint ownership of two or more persons in property, and each of them wants to have a separate share. Partition of property comes with financial and legal implications.

The partition of property in India is governed by Partition Act and Personal laws of inheritance.

Effects of Partition:

  • Once the partition is effected, joint ownership is terminated, and each co-owner becomes the absolute owner of his share and is free to deal with it.
  • When shares of all co-owners are severed, it is partition. When one co-owner is separated, and others continue as joint, it is separation of shares.
  • It involves the transfer and surrender of rights in the property.
  • The property gets divided or is sold, and the proceeds are distributed.

Ancestral or Self Acquired Property:

The property can be ancestral property or self-acquired. Self-acquired property cannot be partitioned during the lifetime of the person who acquired it.

A partition can be effected at the instance of any one of the co-owner and consent of all is not required.

Share of each co-owner:

Share of the co-owners if not defined, needs to be ascertained during partition so that each gets the appropriate share. It is always better to take expert legal assistance to avoid unnecessary disputes.

Family Disputes and Partition:

Family disputes arise more often in case of joint family property. Partition of joint family property can be effected by:

  • Amicable Settlement
  • Forced Settlement – By Arbitration /by court

Amicable Settlement:

Family arrangement – The family arrangement can be done amicably. The members negotiate and settle for their share as per mutually agreed terms and conditions. The family arrangement can be oral or written.

If the family arrangement is only a record of what has been settled, it may be reduced in writing and need not be registered. However, if the document is to be used as an evidence of settlement, then the document is registered.  A partition deed can be executed when the partition takes place with mutual consent.  The partition deed clearly defines the share of each co-owner. The deed is registered, and stamp duty is paid.

Forced Settlement:

Filing a partition suit –If there is a dispute and no amicable solution is there, partition suit is filed, and settlement is arrived at through intervention of the court. The court may physically divide the property, or distribute the sale proceeds of the property.

Court proceedings are time-consuming and at times, a drain on resources. It is better to settle the disputes amicably out of court.

Share of each co-owner is assessed, either with mutual consent or the court appoints a local commissioner for ascertaining the respective shares.

Partition by Arbitration:

An arbitrator is appointed by all the members of the joint family to decide their share and divide the property accordingly.

Partition in case of HUF

Hindu Undivided Family is a concept where all the members are a lineal descendant of a common ancestor. All have equal right in the property. People go for HUF status to avail tax benefits. There is a presumption in case of HUF that assets of HUF are joint property unless the contrary is proved. Only coparceners, i.e. members limited to four generations can seek partition. Daughters married or unmarried can also be coparceners. When partition takes place, all assets are equally divided among all the members.   

Things to do when your home is not selling

Things to do when your home is not selling

A house is essential for a decent living. It is a part of “right to life”, a fundamental right. Investment in a house is made to create a permanent asset.

Investment in real estate is also a lucrative business option, more comfortable and predictable as compared to investment in stocks and shares.

House is put on sale for various reasons like:

  • Relocation
  • Speculative purposes
  • Financial necessity/Distress Sale

If the sale of the house is not getting any response, we advise our clients to consider certain factors as mentioned below: 

Pricing: setting the right price   

Setting the right price for home is very important and depends on the market rate. It is necessary to analyse price influencing factors such as the area where the property is situated, demand for the house whether for residential purpose or speculative investment etc. Accordingly, the price can be changed to attract the buyers and should be set to recover a reasonable amount. Reduction in price should be the last resort.

Time of sale:  Postpone the sale

There is a time when selling a house is more advantageous. It is when the demand for home is rising. Rising income, easy credit availability etc. are some factors which influence the demand for house. If the house is not selling, wait and watch the market movement. If the buyer has too many options, better to postpone the sale.

Try other alternatives: Lease or Rent

If the house is not selling, try other alternatives like offering the house on lease or rent. A tenant may be interested, and such a tenant who has a stake in the house will take good care of the property also.

Sometimes the buyers are not interested in immediate purchase as the arrangement of finance might be a problem. An offer of lease attracts such buyers as there is always an option to buy later. 

Advertisement: Best pictures

Ensure that the sale of the house has been properly advertised to reach to the maximum number and photographs of the house show the best features.

Title of the house and updated government records:

Ensure that the house put on sale has manifestly clear title and is free from all encumbrances. This fact should be evident from the Government records which buyers do check before buying a property. The land where the house is located is not disputed.  Take care that in a housing society, the house is freehold and sale is permitted without hassles.

Incentive:

Try offering some incentive e.g. discount if payment made early or payment made in full at once. 

Repairs/ Renovation:

The house on sale must be in order beforehand.  Repairs, where ever required should be attended. If need be, parts of the house can be renovated to enhance the physical as well as the material value of the house.

Real Estate Agent

The real estate agent hired for selling the house needs to be changed. The sale may require new perspective and better professional skills. Real Estate Agent should not have any vested interest in the sale.

Relocation Companies:

In case of relocation for work, employers arrange for buyouts through relocation companies.  It can be of great help.

Legal Advice: It is always better to engage a lawyer for the brokerage contract, title search, knowing the tax implications and preparation of legal documents, in case of property related matters. Selling a home becomes smooth with right advice and strategy.

What is mutation of property and why it is important for buyers?

What is mutation of property & why it is important for buyers

From a buyer’s point of view, it is imperative that the property he intends to buy has a clear and undisputed title. The onus to verify the title of the property is on the buyer. It requires well-maintained land record/municipal records where all the past transactions related to the property title are duly recorded. It is possible if mutation is done diligently.

There are certain documents which establish property ownership:

  • Registered documents transferring the title, e.g. sale deed
  • Survey documents
  • Land records
  • Property tax receipts

Apart from the registration of documents, there is mutation also, which reveals the owner of the property. Registration is a proof of ownership, but mutation is essential as it records the ownership with the authorities.

What is mutation?

Mutation means entering the name of the owner of the property in the revenue records maintained at the local level by the State. Whenever a property is transferred,i.e. there is a change in the ownership, the name of the new title holder is reflected in the revenue records when mutation is done.

The Government maintains the record as the same enables the authorities to tax thereal property owner.

When is mutation required?

Mutation is required whenever there is a change in ownership effected by:

Is it necessary to get the mutation done?

There are two types of mutation:

  • Mutation of agriculture land
  • Mutation of non– agriculture land

In case of agriculture land, mutation is necessary as the title passes to the new owner, only after mutation. If the Government acquires such land, the compensation is paid only to the person who is the owner as per land revenuerecord.

In case of non-agriculture land, the title of the owner is not affected if mutation isnot done. However, for payment of municipal tax, electricity connection, waterconnection, mutation becomes necessary.

How is mutation done?

An application is made to the Tehsildar with court fee stamp affixed on it. The documentation and fee for mutation differ from State to State.

What is the importance of mutation, especially for a buyer?

Since the onus to verify the title of the property is on the buyer, mutation is of greatsignificance to him. It is essential to get the mutation done because:

  • The Government looks into the land records to verify the actual owner for imposing taxes and for awarding compensation.
  • Mutation shows possession of the property.
  • Mutation is vital for further sale of the property.
  • Mutation helps to prevent the fraudulentsale by seller to more than one buyer.
  • Mutation helps the buyer to ascertain that the property is free from    encumbrances or if there is any liabilityto be incurred by him. 

However, mere mutation does not confer any title. Mutation is invalid if the document transferring the title is not registered as required in law.

It is important to note that mutation is not a onetime process. It needs to be doneregularly to ensure that the property record is clear.

It is always advisable to take legal help from lawyers to effect any transfer of property to avoid legal ramifications later and to ensure that all legal formalities are complied with. Lawyers can provide legal advice and assistance in case of mutation or for cross-checking the revenue records in case of purchase/sale of any property.