Property frauds: 4 checks that will keep you safe
Updated: Jan 25
Often naive home buyers are tricked by scamsters who take advantage of the former's ignorance to dupe them of their hard-earned money. Buying a house is normally the biggest purchase a person makes in his lifetime. Therefore, any laxity in doing due diligence while buying the property could cost you your entire life savings.
Here are four common ways property is sold fraudulently which you should be aware of.
When title deeds or revenue records are fabricated
It is imperative to check if the property you're buying has a clear title and is in the name of the seller whether it's an apartment, land or an independent house. Moreover, the original sale deed should have been registered. You should thoroughly cross-check the entire chain of documents. The chain starting with title deed which validates that the seller is the true owner of the property to sale deed, encumbrance certificate, property tax receipts, among other things.
"As one applies for the encumbrance certificate from the sub-registrar's office, the document should reflect the name of the owner," says lawyer Saravpreet Gurna, who practises in the Punjab and Haryana High Court. The encumbrance certificate certifies that the property has no dues. This means that the title of the property is clear and marketable. In addition, all the transactions related to the flat will be displayed on this certificate. A fake document quoting similar details as mentioned in the original sale deed could also be prepared. "Without relying on photocopies, it's advisable to check the original deed and get it examined by a lawyer," says Noida-based lawyer Atulay Nehra, who specialises in real estate litigations. He says many times a conman gets into sale agreements with different people simultaneously, fraudulently pocketing earnest money from all the deals.
Many cases have emerged in big cities where even though the flat is registered in the name of the owner, the owner may have given a power of attorney to a third party to deal with the property. It is important to check if the power of attorney holder has entered into any arrangement with any third party. Also, it is advisable to cross-check revenue records, such as in the government land revenue department, in situations where the title documents to support the ownership of an individual, is absent. "There have been cases where a property has been registered but mutation has not been done in the local municipal corporation office. It should be cross verified either online or in the revenue department office. Apart from that, making local enquries always come handy," adds Gurna.
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