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Old 9th September 2023, 13:06   #2866
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Re: The Property / Real Estate Thread

That's great. Can you give us the name of the property as my BIL is looking for one in that area. You can inbox me as well. Thanks in advance
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Originally Posted by varkey View Post
Weíve shortlisted an apartment near RR Nagar, Bangalore. Itís a resale of an unused apartment, less than 5 year old building. The seller is an NRI and has not even got it registered to his name. Sellerís realtor said it would be a triparty agreement / sale deed and we would be the first owners on paper.
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Old 9th September 2023, 14:18   #2867
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Re: The Property / Real Estate Thread

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This is a thought I had as well. So I do intend to take a home loan for around 50% of the amount, if so would doing a separate legal review help much? The bank as part of the application process does legal review and collects the fee for the same as well. The bank most definitely would not approve the loan if there are any issues. I intend to get the loan from SBI or BoB (with OD facility to park excess funds).

Since itís a completed property, I also checked with few other owners and they mentioned they didnít face any legal issues as part of their loan applications or in general.
If the person who initially booked the apartment with the builder sells/resells before registration in his/her name, the tripartite agreement is the process. There is no issue with this agreement and it is NOT the sale deed. From my understanding of when we executed a similar tripartite agreement, this acknowledges the payments made by the person who initially booked the apartment and transfers the apartment booking to the 'new person' who now only has to clear the outstanding balance payments prior to/at handover etc. and apartment registration into his/her name.

At registration, the sale deed itself will be only between the builder/developer and the new person, in this case 'you'.

I have a different opinion on the bank lawyers' or legal opinion on the property. Whatever due diligence they would have would have been to safeguard their client's, in this case the bank's interests only. Not that the bank's legal opinion or a bank's "pre-approved project" stamp does not have value, but as an individual buyer, I would say the onus is you to get an independent legal assessment done by a lawyer of your choice who is responsible to make sure there are no issues or highlight any potential concerns. I have had many people tell me that if a project is pre-approved by SBI or nationalized banks, typically there will be no legal issues later etc. and that their legal teams are very good at unearthing issues before agreeing to give home loans.

All this sounds great, but end of the day if you take a home loan, the contract is between you and the bank/disbursing institution. While finer details in the loan agreement vary a bit, usually the EMIs have to be paid whether project is on time or not, there are property-related issues identified later. Not to be a downer, but caveat emptor rules especially in real estate. Having dealt with apartment and site sale/resales in Bangalore a few times, I'd strongly suggest getting your own lawyer's opinion and not rely too much on the bank's report itself.
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Old 12th October 2023, 21:08   #2868
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Re: The Property / Real Estate Thread

Hi friends, could you please help me to make a decision to buy a 2BHK in Mantri Serenity, Kanakpura Road? We really liked the property, amenities and location. But hearing lot of negatives as well.

So wanted to make sure before making any decision.
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Old 24th October 2023, 10:41   #2869
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Re: The Property / Real Estate Thread

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Originally Posted by debjyotimitra View Post
Hi friends, could you please help me to make a decision to buy a 2BHK in Mantri Serenity, Kanakpura Road? We really liked the property, amenities and location. But hearing lot of negatives as well.

So wanted to make sure before making any decision.
Visited this property a few months back as a relative was interested in buying it. Location is very good as it is right behind the metro station and nearby to Forum Mall South. Project has undergone various delays as Mantri Group ran into issues and Tata took over and completed the project. Felt the floor plans are decent and given the nearness to metro there would be good appreciation over time as well. Curious to understand what negatives did you hear?


On a separate topic: Request for fellow members to recommend a good real estate agent/expert/lawyer in Bengaluru who has an understanding of rules around Farm Land sale in Karnataka. A relative wants to sell Farm Land near Hassan and wanted to clarify on some legalities surrounding farm land sale.

Last edited by vsrivatsa : 24th October 2023 at 10:42.
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Old 25th October 2023, 11:02   #2870
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Re: The Property / Real Estate Thread

Cross-posting to an old, very good post on another thread:

https://www.team-bhp.com/forum/shift...ml#post4756001 (Did you ever get cheated by a builder while buying a house? Share tips & advice here)

Only got to see this because someone bumped up an old thread. I think it should be here and should get better visibility because it has some great info.
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Old 25th October 2023, 21:49   #2871
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Re: The Property / Real Estate Thread

Hi,

I am in the process of buying a resale flat and have run into a problem.

I will be using fictional numbers instead of real ones to explain my issue

The seller agreed to sell the flat for 90L initially. His CA is now saying that the government rate of the flat is 80L so a sale agreement will be done on that and I pay the rest in cash to the seller. That will be 10L.

I don't have any black money with me. I never thought it would become a problem.

I want to take a loan so showing 80L as the price of the flat will impact that also.

What are my options? I need some advice. Thanks.
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Old 25th October 2023, 21:57   #2872
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Re: The Property / Real Estate Thread

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Originally Posted by Nightmare View Post
Hi,

I am in the process of buying a resale flat and have run into a problem.

I will be using fictional numbers instead of real ones to explain my issue

The seller agreed to sell the flat for 90L initially. His CA is now saying that the government rate of the flat is 80L so a sale agreement will be done on that and I pay the rest in cash to the seller. That will be 10L.

I don't have any black money with me. I never thought it would become a problem.

I want to take a loan so showing 80L as the price of the flat will impact that also.

What are my options? I need some advice. Thanks.
Point blank refuse. Several reasons:

1) If you go with his suggestion, it needlessly increases your tax liability when you sell in future (since your cost basis would've been *artificially* low)
2) It's against the law.
3) Black money usecases are reducing day by day as more and more people realise that it ain't worth the bother and living life on the edge. Nowadays the loop is closing on more and more financial transactions (with AIS and it's ever expanding scope)
4) It's possible but less likely he'll get someone else to agree to his suggestion. So pushback hard till he backs down, else don't be afraid to say NO and walk away from the deal.
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Old 25th October 2023, 23:06   #2873
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by Nightmare View Post
Hi,

I am in the process of buying a resale flat and have run into a problem.

I will be using fictional numbers instead of real ones to explain my issue

The seller agreed to sell the flat for 90L initially. His CA is now saying that the government rate of the flat is 80L so a sale agreement will be done on that and I pay the rest in cash to the seller. That will be 10L.

I don't have any black money with me. I never thought it would become a problem.

I want to take a loan so showing 80L as the price of the flat will impact that also.

What are my options? I need some advice. Thanks.
While everything is possible, simply make up your mind on one option - accept or reject. And then stick to it regardless of the outcome of this deal or any other future deal.

Taking a stand is more important here. Shouldn't be an issue in finding a seller who is willing to do a completely white transaction in larger Metros these days. That is the recommended way, no matter the implied higher tax. Better to stay in white when you earn only white.
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Old 25th October 2023, 23:48   #2874
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Re: The Property / Real Estate Thread

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Originally Posted by Nightmare View Post
What are my options? I need some advice. Thanks.
Just a simple question to yourself. What are you benefiting out of this? Will he reduce the price if you agree to this arrangement? If no, then reject it outright. If Yes, since you are going for a loan, it again is not possible as bank needs all white transaction records.
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Old 26th October 2023, 09:04   #2875
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by Nightmare View Post
Hi,

I am in the process of buying a resale flat and have run into a problem.

What are my options? I need some advice. Thanks.
If this is just another property and there are plenty of alternatives to suit your needs, then give it a pass. Basically, don't get involved in questionable deals just to save some money. From what I can tell, one doesn't need to go through this hassle to buy an apartment on home loan in a city like Bangalore. This type of scenario generally applies to land deals.

Also remember that the reason people buy with cash is because they have cash to get rid of. Converting tax paid bank money into cash to buy real estate is a terrible idea financially speaking. RE returns are poor to start with and investing like this is even worse.

Is there anything very special about this property? Things like a property next door to your existing property, or the only property available for sale and an alternative is unlikely to come up for sale anytime soon, etc. Basically, if it is THE property you absolutely can't pass up, then be 'pragmatic' and make it happen.

1. Try to convince the seller that you can only make full cheque payment. Bangalore is far better than other cities when it comes to sellers accommodating such requests. Guidance value of most properties in Bangalore is pretty close to market value so there isn't a huge margin to play with.

2. Offer to pay little extra if that helps in convincing the seller (assuming you have the financial flexibility). It's worth paying a little extra to keep things clean.

3. I hate transacting with sellers/buyers who refuse to accommodate reasonable requests from the other party or act very high handed. I consider them bad luck.

4. Beyond this point, take counsel/help from your family members and proceed. Don't do it just to save money however tempting it might be.
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Old 26th October 2023, 12:36   #2876
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by Nightmare View Post
Hi,

I am in the process of buying a resale flat and have run into a problem.

I will be using fictional numbers instead of real ones to explain my issue

The seller agreed to sell the flat for 90L initially. His CA is now saying that the government rate of the flat is 80L so a sale agreement will be done on that and I pay the rest in cash to the seller. That will be 10L.

I don't have any black money with me. I never thought it would become a problem.

I want to take a loan so showing 80L as the price of the flat will impact that also.

What are my options? I need some advice. Thanks.
Having bought four properties in Bangalore using only tax paid White money, I understand the problems that we face while purchasing a property, where majority of people demand some amount of cash component.

One good thing is that you are taking a loan to purchase the property. I hope that you have not revealed to the seller what % of property value you are planning to take as loan. When asked, I always tell the seller that I will be taking loan from SBI, and that I would be taking 90% (or sometimes 85%) of the value as loan from SBI. It helps me to control amount given at time of 'Agreement of Sale' as 10%, because many sellers do ask for 25%-50% at time of Agreement of Sale. Also, it weeds out demand of any cash component from the seller as I need to show the bank that I have paid 10% as my contribution, which I cannot show otherwise if it is given as cash. It has helped my in each and every successful deal.

If it is a property which you 'must' buy, and if the seller does not agree for all white, then there is no other option. You can try asking him to reduce the cash portion to something you can manage to withdraw from your bank account (you need to give declaration to bank in writing the reason for withdrawing a large amount of cash). Also you can make it clear to the seller that you would be handing over the cash part only after signing the sales deed in sub-registrar office, as most sellers want to have the cash before anything. But i would not recommend this path.

It is not easy to find a new buyer, and if you put your points clearly (90% financing via loan) to the seller, I think the seller might agree for full white transaction.
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Old 26th October 2023, 15:49   #2877
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Re: The Property / Real Estate Thread

Quote:
Originally Posted by Nightmare View Post
The seller agreed to sell the flat for 90L initially. His CA is now saying that the government rate of the flat is 80L so a sale agreement will be done on that and I pay the rest in cash to the seller. That will be 10L.
Quite far from the truth. Assuming the Govt rate is 80L, the sale can be even at 160 L.

Basically, the seller is trying to save a little on the LTCG there. Even if the sale is at 80L, he still will be paying LTCG (since the 80L will be more than than his purchase price).

You just need to remember one point - the sale value as registered cannot be less than that 80L. You can go as high as you want to. And the stamp duty, registration charges, and then the seller's LTCG will all be in proportion to the sale value you declare at registration.
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Old 27th October 2023, 17:28   #2878
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Re: The Property / Real Estate Thread

Hey everyone,

I bought a flat in one of the under construction properties of Prestige in Bangalore which is now ready for handover. Because I'm not an expert myself in checking the construction quality and other things, I planned to hire some professional help to do the home inspection. Some reports of water seepage and gaps in tiles, etc., from other owners who took early possession also contributed to this decision.

But the CRM who handles the handover process is denying this request and saying that Prestige does not allow external home inspection services.

How do we deal with such things. Any legal provision which can help me in this or any other suggestions?
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Old 27th October 2023, 18:26   #2879
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Re: The Property / Real Estate Thread

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Even if the sale is at 80L, he still will be paying LTCG (since the 80L will be more than than his purchase price).
Also, sellers tax liability would reduce, in case with indexation benefit on LTCG on property sale. I hope I'm right here.
With this clause, I remember how I tried to convince the seller to increase the sales consideration value
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Old 27th October 2023, 19:03   #2880
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Re: The Property / Real Estate Thread

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Also, sellers tax liability would reduce, in case with indexation benefit on LTCG on property sale.
Indexation does allow the seller to claim some benefit for the expenses he had to incur on the property during his ownership. indexation value is not dependent on registered sale price, but will take the cost price of the seller into consideration.

Both are separate points.
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