Thread: Terms and conditions of buying an apartment

Investment in an apartment or flat is a major commitment. It is important for prospective buyers to know their rights and obligations. A set of terms and conditions govern a prospective Cochin apartment owner’s interactions with a builder. A prior knowledge of these will give you confidence to deal with a builder. The information will be useful and will enable you to make wise decisions about the many aspects of owning an apartment or flat in Kerala.

Of the three principal documents for your apartment, the first is an unregistered, stamped agreement between the prospective owner and the builder which lists mutual obligations for constructing the apartment. The second is the land agreement, also an unregistered, stamped agreement, setting out the terms and conditions to be complied with to get the undivided interest in the land proportionate to the apartment being constructed.

The third document is a registered sale deed which transfers an undivided share in the land into the apartment owner’s name. This sale deed is registered prior to handing over, after full payment is received. The contract value for the apartment covers the cost of the undivided share in land and the cost of construction of the apartment.

Prompt installment and tax payments are necessary to facilitate the smooth completion of an apartment project, so interest will be charged on all arrears of payments. In case of non-performance of the client in making payment, the builder has the right to cancel the allotment and to allot the apartment to a third party. The amount paid up to the time will be refunded to the client after realizing funds through sale of the said apartment to a third party. The amount will be refunded to the client after realizing funds through sale but without interest, after deducting a certain percentage of the contract value.

This is nice information on some points which we have to take care before buying an apartment.