Many a time home buyers buy a home and don’t know whether they have landed safe. Especially whether the property is on loan or not.
By Varun Singh
When one buys a home they can check the brick and mortar, how big the flat is or not, but don’t know whether the flat is on loan or not.
But now it won’t be the case, before you buy a home you can check whether it’s on loan or not but now you can check.
Recently MahaRERA came out with a circular which has made the builders to submit a report on whether the property they are selling is on loan or not?
The circular states, “Ministry of finance has notified the establishment of Central Registry Securitisation Asset Reconstruction and Security Interest of India (CERSAI), a government company, incorporated for the purpose of operating and maintaining the Central Registry under the provision of the Securitisation and Reconstruction of financial assets and enforcement of security interest act 2002.”
The objective of setting up of central registry is to prevent frauds in loan cases involving multiple lending from different banks on the same immovable property.
Government of India has subsequently issued a gazette notification on January 22, 2016 for filing of the following types of security interest on the CERSAI portal.
a) Particulars of creation, modification or Satisfaction of security interest in immovable property by mortgage Other than mortgage by deposit of title deeds.
b) Particulars of creation, modification or satisfaction faction of security interest in hypothecation of plant and machinery, stocks, deaths including book debts or receivables, whether existing or future.
c) Particulars of creation, modification of satisfaction of security interest in intangible assets being know how, patents, copyright, trademark, license, franchise or any other business or commercial right of similar nature.
d) Particulars of creation, modification of satisfaction of security interest in any under construction residential or commercial or a part thereof by an agreement or instrument other than mortgage.
Whereas, CERSAI had started registration of the data in respect of paragraphs 82C for the security interests created on or after January 22, 2016 with affect from me 25, 2016 for scheduled commercial banks and with effect from July 1, 2016 for all other entities registered with them.
Further, the registration of data in respect of paragraph D has commenced June 8, 2017 for all banks and financial institutions registered with CERSAI.
The MahaRERA circular says that homebuyers and allottees should be aware of such security interest created on real estate projects/apartments which home buyer is interested in purchasing.
Therefore now builders will have to during project registration submit report from CERSAI on security interests created in the real estate project along with the encumbrances certificate. In case no security interest has been created and builder shall provide an undertaking confirming the same.
Further the builder Has to also submit a CERSAI report when there are any changes on security interests created on real estate project by the builder.
The CERSAI reports submitted should be generated within 10 days before the date of submission.
So now a homebuyer can just visit MahaRERA website before buying a house and know whether the property is already on loan or not.
Adv Sunil Kewalramani says, “The MahaRERA has taken a great step by issuing this Order as it will further increase transparency in the Real Estate Industry. Now the home-buyers can check security interest created by the Developer in the Real Estate Project, Apartment which homebuyers is interested in purchasing.”
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