6 Rules To Stop Builders From Delaying Your Dream Home
As we all know that #RERA Act has been implemented, so, what are those 6 rules of this Act, which will stop builders from delaying the delivery of a buyer’s dream home? Let’s check out what Real Estate (Regulation and Development) Act, 2016 has secured to ensure the timely possession of properties.
For the buyers of any real estate properties, the delay in ownership of their homes has been a major concern. The delay in possession of properties has been extended to almost six years or more for many of the homebuyers across many locations and many builders. Without regulator and rules in place, the buyer-builder battle always appeared one-sided.
Now, the #RealEstate has got its own regulator on May 1, 2017 in the form of RERA Act, which became effective from the same date in the whole nation; and, each state and union territories will be required to have their own Regulatory Authorities that will be framing rules and regulations according to the act.
The developers, who haven’t received a completion certificate, will also be required to get themselves registered. On getting the registration, they will also be needed to follow the rules and regulations of the State Regulatory Authority.
The Promoters’ Promise:
The six important provisions in #RERA, which may prevent the builders from delaying the possession of projects and stick to the deadlines instead of making default are given below.
WRITTEN AFFIDAVIT:
Under this, the promoters will be necessary to give a declaration that should be supported by an affidavit stating the time frame within which the project will be completed.
POSSESSION DATE WILL BE REVERED:
Moreover, the “Agreement of Sale” will be carrying the date of possession with the rate of interest in the case of any default. It is to be remembered that the time frame could be different amongst developers.
CLEAR TITLE OF THE LAND:
A written affidavit will be required to be submitted by the promoter, stating that the legal title to the land has legally valid documents and authentication of such title, on which the development is proposed, if such land is owned by another person.
FREE FROM ENCUMBRANCES:
The promoter has to submit a written affidavit stating that land is free from all hindrances, as often it has seen that various projects get delayed due to the hindrances that prevent promoters to transfer the title to the property.
MAINTAINING SEPARATE ACCOUNT:
Total 70% of the amount released for the real estate projects from buyers, from time to time, would be submitted in a separate account, which will be required to maintain in a scheduled bank for covering the cost of the construction with the land cost and would be utilized only for that purpose.
Further, the withdrawals from the account will be according to the extent of the work completed after it is certified by an architect, a chartered accountant or an engineer. And, it will be subject to an audit that will be conducted every six-month.
MAKING IT AN OFFENSE:
In case of disobeying the rules, the builders will be losing the registration of the project and may also be punishable by imprisonment that may extend up to 3 years or with/without a fine that may also extend up to 10% of the estimated cost of the real estate project or both. However, some states have compounded the offense to avoid the imprisonment of the developers.
What Happens If Still There Are Defaults?
Well, the RERA has taken steps to make the promoter responsible and make them submit the compensation and penalty in case of any default in the provisions of the rules. If builder defaults and delays in giving the possession of the property according to the “Agreement of Sale” the buyer will have the right to claim the refund of the amount paid along with the interest. And, if the buyer doesn’t wish to withdraw from the project and doesn’t want the refund, then the promoter will have to pay the interest for each month of delay until handing over the possession.
Conclusion:
It is essential that the Act doesn’t get adulterated by the states, and if need be, the center must interfere in this matter. The state regulatory authorities are likely to keep an eye on their execution and take ‘suo-moto action’ (they can do so under the section 5 of the RERA Act) against the developers who are doing any discriminating practice or not following the provisions of the act. Hope, the homebuyers will not suffer anymore by running around and be at the clemency of builders.
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