What Documents Do You Need To Verify Before Buying A Plot?
Here are the crucial documents to check before purchasing a block of land. Are you looking to buy a plot? Plots offer various advantages over flats. They often demand a small initial investment—buying a plot is less expensive than acquiring a furnished flat. However, regardless of the property type, extensive due diligence is required. This entails determining whether the plot possesses all relevant official documentation. The absence of any document may deem the transaction illegal, potentially leading to further litigation.
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When you wish to sell the land in the future, missing documentation may cast doubt on its legality or increase the danger of fraudulent activities. This article covers the paperwork you should obtain from the vendor once you have registered the plot and made the complete and final payment.
Non-agricultural land use certificate.
India is primarily an agricultural country, with all land first classified as agricultural. Construction requires the conversion of agricultural land to non-agricultural land under certain conditions. The non-agricultural land classes include the following:
- Non-agricultural land for residential use
- Non-agricultural property for business purposes
- A Non-agricultural land for warehouses or industry.
The land use certificate will indicate the purpose for which you are purchasing land. You should insist on checking and validating it.
Land Deed
Also known as the 7/12 paperwork, you should obtain it from the present and prior owners of the property. The 7/12 land deed includes Form VII and Form XII.
- Form VII contains details such as the owner’s record of rights, ownership details, tenant information, revenue obligations, & other land-related details.
- Form XII contains information about crops and the area they cover.
To buy a land in Maharashtra, you must have a 7/12 certificate, which can be from any state.
Original Sale Deed
This legal agreement sets out the terms and conditions of the plot purchase. No plot acquisition is complete without the sale deed, also known as the title deed, being signed and registered by both the seller and the buyer.
A sale deed contains:
- The property’s selling price
- A description of the plot
- Names of property owner(s)
- How will the plot ownership be transferred after payment is completed?
Before purchasing, consult with a lawyer about the selling transaction. If any information is lacking, seek it from the seller. For example, Johan Shah’s ancestral estate was named after his father & two uncles. After his father died, the uncles tried to sell the site without the signature of the third owner (Johan Shah’s father) or his legal heir (Johan Shah). This inconsistency was discovered during due diligence, preventing a transaction that could lead to lawsuit.
Legal heir certificate
If you are buying land from a deceased seller, the seller you are working with should have a legal heir certificate.
Encumbrance Certificate
Any property you buy, whether an apartment or a site, should be free of encumbrances. This certificate can be obtained at the sub-registrar’s office and is only valid for a limited time. It is necessary for obtaining a home loan, as banks would not consider loans for properties with legal difficulties. An encumbrance certificate is only issued to registered properties, therefore acquiring one double-checks your property’s legal registration status.
Power of Attorney
If someone is selling the plot on behalf of the owner, be sure the power of attorney (PoA) is in order. This legal document authorizes the PoA holder to oversee the sale process and funds. Verify the PoA document thoroughly with a lawyer to avoid middlemen fraud.
No objection certificate (NOC).
Check that the plot has no-objection certificates (NOCs) from all relevant local entities, including the municipal corporation and environmental authorities. Obtain a no-dues certificate from the local authority for property tax and from the corresponding bank if a loan was used to purchase or maintain the plot. Ensure that property tax on unoccupied land is paid; if it is not paid and the sale deed is passed to the new owner, they will be liable for any outstanding payments & penalties.
Celebrities have recently invested in plots.
| Salma Khan | Carter Road, Bandra |
| Kriti Sanon | Alibaug |
| Suhana Khan | Alibaug |
| Amitabh Bachchan | Ayodhya, Alibaug |
Navimumbaihouses.com Point of View
Purchasing a block of land or property is a major investment. To enhance your profits, you must conduct due diligence by analysing all essential documents with a lawyer. Any missing paperwork, or excuses from the vendor for their lack, should be regards red flags. Do not proceed with the transaction if there are any outstanding difficulties.
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