12th May 2010
Most people rely on brokers to do the necessary paper work when they are selling their property. It might make things simpler and less tedious for the seller but still a basic knowledge of documentation required can make things easier for you.
What are the essential documents to sell the house?
To sell a residential property the documents required are:
1. Housing society share certificate
2. Sale/purchase deed.
3. Sale deed will confirm if the land is in the name of the seller and only he/she has the full right to sell the land.
4. Copy of previous deeds, if required, to confirm the authenticity of the deal and the property.
5. Original copies of stamp duty and registered house documents.
6.NOC from the housing society.
7.In case of a joint ownership, the owner/owners have to submit documented consent.
Home buyers insist on these documents if they are opting for a housing loan.
How to file for missing documents?
Often old houses, which are 30-40 year old constructions, may not have proper registration.
1. Owner should pay off the outstanding stamp duty and file for a registration.
2. In the case of a missing share certificate, the intending seller should request the housing society to issue a duplicate copy.
3. If the sale/purchase deed and/or chain of agreements/deeds are misplaced, an indemnity bond needs to be furnished by the seller, along with a confirmation letter from the housing society,”
4. If the original copy of stamp duty and registered house documents are unavailable, an indemnity bond should be furnished by the seller.
5.In any case, the deed needs to be registered after paying up the valid stamp duty.
6. A public notice also needs to be issued.
When the property mortgaged with the bank?
You cannot sell the property if you are still paying back the loan taken to buy the property.
Pay off only 99% of the loan with the money you get from sale agreement and pay off the balance 1% over a period of timer to avoid foreclosure charges.
What are the other clearances before putting the house on sale?
Apart from the title clearance and NOC from the society, the precise details pertaining to the age of the building, the floor plan, the carpet and built-up area, the conveyance of the society, car parking status, land title (free hold/lease hold/collectors land) and transfer charges of the building and the apartment need to be attended to.
Tax implications
The capital gain would be exempt from tax under Section 54 and Section 54F if the sale proceeds are invested in a residential house and if you do not own more than one residential house at the time of purchase of such a house.
But you have to purchase the new house within a year before the sale. Otherwise, this capital gain or net consideration is required to be deposited in a separate account before you file the return.
You can reinvest only in a residential property. This doesn’t include a commercial property or vacant plot of land. Similarly, short-term capital gains enjoy no exemption.
“The house you are planning to sell would be classified as short-term capital asset as the holding period is less than three years. There is no exemption available on reinvestment, be it a new house or capital gains tax saving bonds |
