While buying a new home, many questions may pop up in your mind. This is an attempt to answer common queries about buying and owing property in India. Use this guide to acquaint yourself with rules, laws and other important information.

Q1. What is the difference between Built-up Area, Super Built-Up Area, and Carpet Area?
Ans. Carpet Area : As the name suggests, Carpet Area is the area where a carpet can be spread; which means the area calculated comprises the inner wall to wall distance inside the house. This would also include steps, if any, inside the house. Generally, the column offsets are taken into consideration while calculating carpet area, with door jambs also forming part of it.

Built up Area : Built up area is Carpet Area + Area of walls and ducts. This is usually 10% to 12 % more than the carpet area.At present, all plans are approved as perbuilt-up area. In case of calculating the area for registration, if only the carpet area is provided in the agreement for sale, the registrar adds 20% to itin order to arrive at the built-up area, onlyfor the limited purpose of stamp duty calculation.

Super Built-up Area : This is built up area + area occupied by common amenities like elevators, corridors, awnings, club house, stairs. Super built-up area is usually around 50 % to 70% more than the Carpet area. This is also called as Saleable Area. This varies from location to location and projects, depending on the amenities / facilities / common area spaces, etc.
Q2. What are the common Plan and Approval Terminologies and their meanings?
Ans. A) IOD (Intimation of Disapproval)
IOD is the first Plan which is approved and contains terms and conditions to be fulfilled before commencement of work for any project. An IOD can be issued in a phased manner for a project or even for a single building. IOD with plans would help in understandingthe number of floors or buildings that have been approved.
B) CC (Commencement Certificate)
CC is a permission that allows the developer to start work as per the approved plan, in line with the IOD.The CC would have various endorsementsit would be validated from time to time.The First Endorsement is generally issued up till the Plinth to start work and in case of podiums, till the top.Upon the completion of work, inspection is done and endorsement on CC is given to proceed further.
C) OC (Occupation Certificate)
OC is issued when the building work is complete in all respects and the structure is now habitable. It is only after receipt of OC that water connection is made to the building.
D) BCC (Building Completion Certificate)
BCC is issued after the water connection is given to the building and BCC denotes that all the obligations of the developer and all the conditions in the IOD and CC have been fulfilled and that the project is complete in all respects.
Q3. Who can buy property in India?
A) Is there a restriction on Indian citizens to buy property in India?
No, there is no restriction on Indian citizens to buy property in India, except certain conditions and certain states that are notified under the constitution of India, wherein only persons having domicile of the state in question are allowed to buy properties there.
B) Is there a permission required for NRIs to buy properties in India?
No, there are no specific permissions required for NRIs to buy properties in India. However,repatriation on the sale of such properties is governed by rules and regulations.

Q4. Who is a NRI?
Ans. A NRI is a person residing outside India, who is either a citizen of India or a person of Indian origin. A NRI is an Indian Citizen who has migrated to another Country. For all official purposes, the Government of India considers a NRI to be an Indian National who stays away from India for more than 182 days in a year.
Q5. Who is a PIO?
Ans. A person of Indian origin means an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka Or Afghanistan or China or Iran or Nepal or Bhutan) who:
1) held an Indian passport at any time, or
2) Who or whose father or paternal grandfather was a citizen of India by virtue of the constitution of India or the Citizenship Act, 1955.


Q6. What are the documents that should be verified before buying a residential / commercial unit?
Q7. What documents are required to be executed if the intended purchaser wishes to proceed for purchase of premises?
Ans. The Developer shall execute an Agreement for Sale as per the provisions of The Maharashtra Ownership Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963 (the MOFA)
Q8. What is the procedure for execution of the Agreement for Sale?
Ans. The procedure involved is three-fold:
The above can be explained in detail, as follows:
1. Stamp Duty
Unless there is an agreement to the contrary, the stamp duty shall be borne and paidby the Purchaser as per Section 30 of the Maharashtra Stamp Act, 2013.As per prevailing laws, the stamp duty to be paid on the Agreement for Sale shall be an amount equivalent to 5% on the market value of the unit as per prevalent ready reckoner rates.Market value means the price at which a unit could be bought in the open market on the date of execution of such instrument. This price is determined on the basis of the ready reckoner issued each year.The Mode of payment of stamp duty is E-Payment through GRAS (Govt. Receipt Accounting System)
2. Execution
After the payment of stamp duty on the Agreement for Sale, the same shall be duly executed by all the parties, i.e. the Developer/Promoter and the Purchaser/s. All the pages of the document should be signed by all the parties. The Agreement should be witnessed by at least two witnesses giving their full names, signatures, and addresses.
3. Registration
The duly stamped and executed Agreement for Sale should be presented at the office of the concerned Sub-Registrar of Assurances for registration within 4 (four) months from the date of execution of Agreement for Sale.In case of delay in presenting within the stipulated four months from the date of execution of Agreement for Sale citing unavoidable circumstances by the Parties, the Registrar may condone the delay after collecting penalty under section 25 of the Indian Registration Act, 1908; provided the delay in presentation of the executed Agreement for Sale does not exceed 4 (four) months from the date of expiration of the aforesaid stipulated 4 (four) months (i.e. does not exceed 8 (eight) months from the date of execution of the Agreement for Sale). Registration of the Agreement for Sale is compulsory as per Section 17 of Indian Registration Act, 1908. The registration fees shall be an amount being 1% of the market value of the unit, subject to maximum of Rs.30,000/-.

Q9. Why is it considered necessary to register a property? What is the purpose of registration?
Ans. 1. By registering the transaction of an immovable property, it becomes a permanent public record. This is a notice to the general public. Those getting transfer of property should verify whether such property has been previously encumbered. According to the Transfer of Property Act, 1882 right title or interest can be acquired only if the deed is registered.
2. By registering the transaction of an immovable property, it becomes permanent public record. Title or interest can be acquired only if the deed is registered.


Q10. From where can I get home loans?
Ans. There are several Banks / Housing Finance Institutes who provide Home Loans.
Q11. Why one should opt for a Home Loan?
Ans. All Banks / HFIs have a stringent process to verify all the documents in terms of Title of the land, Approval for the project, etc.As they are offering loans, they would investigate with due diligence before loan disbursement. Hence, for an individual, it is advisable to have a home loan so that all the documents are verified by the banker before disbursement of loan.
Q12. What is APF (Approved Project File)?
Ans. In order to process home loan faster for customers, banks generally approve the project beforehand and allot aAPF number. Once a Project has an APF number, processing a home loan for the project with that bank would be very easy and less time consuming. APF number also signifies that bank has already done the due diligence and is ready to fund home loans.
Q13. How much loan can one get?
Ans. You can get a Home Loan of up to 80% of the Total Consideration Value or your eligibility, whichever is lower.
Q14. Can a Home Loan be pre-approved?
Ans. Yes, you can avail for a pre-approval from any financial institution.However, all pre approvals have a validity period, which may be checked with the concerned financial institutions.
Q15. Can I have Co-Ownership in the property?
Ans.Yes you can have your wife, son/daughter, father/mother as a Co-Borrower. However, it is advisable to check with the Financial Institution regarding their permissible ownership grid.
Q16. Who can be a co-applicant for the loan?
Ans. The spouse of the applicant can be included as a co-applicant for the home loan and his/her income shall be included to enhance the loan amount. Further, in case there are other co-owners, they also need to be co-applicants.
Q17. Is Co-Applicant/Local P.O.A mandatory for applying for Home Loans, even if I don’t have a Co-borrower in the property?
Ans. Certain financial institutions have made it mandatory for a Co-Applicant to join in the Loan (irrespective of his/her being/not being a Co-Owner in the property, with a Local Power of Attorney Holder in India. This may further be clarified with theconcerned financial institution.
Q18 What is the repayment period of the loan?
Ans. You can select the payment period you are comfortable with - up to 20 years or Retirement, whichever is earlier. In some cases,home loans are approved for a period of 25 years.
Q19. What is the Process for Application?
Ans. Application needs to be made in the prescribed Application Form of the financial institution, along with Relevant documents and Processing Fees to the concerned Financial Institution.On Approval/ Sanction of the Application the Financial Institution forwards a Approval/Sanction Letter To the Applicant & Co-Applicant.On Receipt of the approval Letter, the property can be selected/ if selected the disbursement process can be initiated.
Q20. What are the documents required to get the loan sanctioned?
Ans. An indicative list is given below. Representatives of the concerned financial Institution will give you further details.


A number of factors such as your income, age, number of dependants, qualifications, assets and liabilities, income stability/ continuity of your employment / business etc. are taken into account when assessing your repayment capacity.However, there are ways by which you can enhance your eligibility: If your spouse is earning, add him/her as a co-applicant. The additional income shall be included to enhance your loan amount. Incidentally, if there are any co-owners they must necessarily be co-applicants. Did you know that your fiancée's income could also be considered for sanctioning the loan on your combined income? The disbursement of the loan, however, is done only after you submit proof of your marriage. Providing additional security like bonds, fixed deposits and LIC policies may also help to enhance eligibility. While there is no need for a guarantor, having one might enhance your credibility with us. If so, our loan officer would provide you with the necessary details. However, the final amount to be sanctioned will depend on your repayment capacity. In the total cost, registration charges, transfer charges and stamp duty costs are included.


Documents required for applying for a home loan (for salaried clients)

Documents required for applying for a home loan (for self-employed professionals and businessmen)



Your loan will be disbursed after you identify and select the property that you are purchasing and submit the requisite legal documents. Each and every single document asked for will be verified and checked for your safety. This may take some time but we want to ensure a clear title by completing all the legal and technical verifications so that you have full rights to your home. The 230 A Clearance of the seller and / or 37I clearance from the appropriate income tax authorities (if applicable) is also needed. On satisfactory completion of the above, registration of the conveyance deed and investment of your own contribution, the loan amount (as warranted by the stage of construction) will be disbursed by Bank. The disbursement will be in favour of the builder/seller.


After the disbursement of Loan, the Mortgage needs to be intimated to the sub registrar within 30 days of disbursement.This is mandatory, failing which there are penalties to be paid by the borrower.

Q22. How are home loans repaid?
Ans. The home loan repayment is by Equated Monthly Installments (EMIs) comprising of interest and principal amount calculated on monthly rests through Post Dated Cheques or ECS mode. In case of part disbursement of the loan, monthly interest is payable only on the disbursed amount. This interest is called Pre-EMI interest and is payable monthly till the final disbursement is made, after which the EMIs would commence.
Q23. What is the security provided for the loan?
Ans. The Property being financed is mortgaged with the Financial Institution as the Primary security. However other Co-Lateral security can be asked for based on the Applicants Financial Profile/ Others, which are solely determined by the financial Institutions.


Sub Vention Scheme
Sub-Vention scheme under which the developer is ready to subvent with the bank on Interest for a particular period. Say for example interest subvention for 2 years or interest subvention upto possession for fit outs which shall be clearly mentioned and in most cases there would be a tri partite MOU between Developer, Bank and Customer clearly mentioning the time lines for the scheme. The MOU also clarifies that customer shall pay the EMI / Pre EMI after the subvention period is over.
Parallel Funding
In parallel funding, when a customer has shortage of Own Contribution in such event he opts for parallel funding under which he contributes the required payment form his side and Bank also disburses home loan. This gives customer a comfort of arranging the required own contribution and as work progress.
Easy Payment Plan
Banks generally offers easy payment plan to suit the requirement of the borrower. There are various schemes which has option of lower initial own contribution and balance own contribution is paid before the last disbursement of home loan.
Q24. What are the forms available to manage the affairs of building and Maintenance?
Ans. A) Private Limited Company : Where in a Company is registered under the companies Act 1956 to own a land and building and look forward to manage the affairs.
B) Condominiums : Condominiums are generally preferred in case of commercial premises.In condominiums, the Land and common areas are available to person in ratio of holding. Also, the title is transferred together with undivided rights to the common areas
C) Association of Persons : Association of persons does not hold any right, title and interest in the land and building, the AOP is formed with the sole objective of maintaining the society.
D) Co – Operative Housing Society : This is the most common form of association formed in Maharashtra with its affairs being governed by the society. The Land is conveyed to the society,hence it becomes the owner of the land and building;its members have undivided rights in the society.
There are four types of societies that can be formed:
Disclaimer: The purpose of these FAQs is to provide the visitors with a general understanding of the various issues relating to House Property. The above FAQs have been prepared on the basis of advice received and may vary from person to person, based on facts of such case. Reasonable efforts have been taken in collecting, preparing and providing quality information, but we do not warrant or guarantee the accuracy, completeness, adequacy or currency of the information. The contents of the FAQ are subject to changes / amendments made by the CBDT / Finance Ministry.