Sunday, April 13, 2008

Documents needed for purchase of property

Some documents that those intending to purchase a property should ensure are in order.

A great deal of scrutiny is required before buying property. You should be diligent and check on the title of the property thoroughly. You should also check the mortgage status of the property. A clear title is also a pre-requisite for getting loans from banks or housing finance companies. In case the title of the seller is not clear, complications arising in future may be numerous. Banks will not provide loan for such a property. It will not be possible to re-sell the property too.
These documents and points should be kept in mind by a purchaser in order to minimise risks:

Conveyance or sale deed

This refers to the deed document by which the title of property is conveyed by the seller to the purchaser. Conveyance is the act of transferring ownership of the property from a seller to the buyer. This document helps the purchaser ascertain whether the property proposed to be bought is on the land belonging to the seller.

Search report and title certificate

A lawyer prepares the search/title report. This certificate is issued after conducting a search on the title of the property, which is intended to be purchased. The title certificate would state whether the property is unencumbered and has a clear marketable title. A search report on the title of a property is taken for the past 30 years. This document would state whether there is any existing mortgage, litigation, condition or claim, which is likely to affect the title of the buyer adversely. In case a buyer is intending to take a housing loan, the bank/housing finance company gets this report prepared.


This extract is issued by a Tahsildar or the land authorities concerned. It gives details of the property including survey numbers, location, area, date from which current owner is registered as owner etc.

Permission for non-agricultural use

This is very important. In case the land proposed to be bought is an agricultural land, and if one intends to develop the land for residential/commercial/industrial use, the land has to be first converted to non-agricultural land. In order to do so, a non-agriculture order has to be obtained from the District Collector in whose jurisdiction the property is located.

Along with this, one also needs the receipt for payment of non-agriculture tax. In cases where conversion from agricultural use to nonagriculture use is not done within the stipulated period, there should be an order from the authority concerned extending the period.

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