'Hum Bethe Hain Ji...': Property Frauds You Must Know Before Buying A Flat

Buying a flat in India can be a rewarding investment, but it also comes with its fair share of challenges. The Indian real estate market holds immense potential, but it also carries the risk of fraud.

Real estate frauds, such as title disputes, illegal constructions, and forged documents, are prevalent in the industry. Buyers need to be vigilant and conduct thorough due diligence to avoid falling victim to scams.

Also Read: Who Is Investing In Indian Real Estate And Where? Check This Report

Here’s a breakdown of some common frauds to be aware of when buying a new flat:

1. Title Fraud: Ensure the seller has clear and undisputed ownership of the property. Title fraud occurs when someone falsely claims to own a property and sells it to unsuspecting buyers. Don’t go by the word of property sellers, builders, or their agents. ‘Hum bethe hain ji, chinta ki koi baat nai hai’ (We are here, don’t worry about anything), is the common dialogue they offer when you question the credibility of any claim.
2. Encroachment: Verify that the property boundaries are accurately marked, and that there are no encroachments on the land. Encroachment occurs when someone illegally occupies or builds on land that doesn’t belong to them. RERA website and respective town planning bodies like NOIDA, GNIDA or DDA can be helpful to find details of builders.
3. Rushed Sales: Fraudsters might pressure you into a quick decision, leaving no time for due diligence. Don’t be swayed by urgency; take your time to research and understand the property.
4. Pre-Launch Scams: Promises of guaranteed high returns are often red flags. Be wary of schemes that seem too good to be true. Fraudsters might lure you in with attractive pre-launch offers for unapproved projects. Invest only in RERA-registered projects with proper approvals.
5. Inordinate Delays: Unreasonable delays in possession after payment could signal financial trouble with the builder. Check the builder’s track record and be cautious of excessive delays. Several home buyers are struggling to get possession of their homes in Delhi NCR.
6. False Promises: Watch out for exaggerated amenities, unrealistic completion dates, or hidden charges not mentioned in the initial agreement.
7. Forced Cancellation: Some builders might try to bully you into cancelling the booking later, often with unfair penalties. Understand the cancellation clause clearly beforehand. Take the help of police/ lawyers in case of unlawful conduct by any builder.
8. Deviation from Plans & Specifications: The final product may not match the promised specifications or amenities. Carefully review the agreement and be wary of deviations during construction.
9. Fake Documents: Thoroughly examine all property documents, including sale deed, occupancy certificate, building plan approvals, etc., to ensure they are genuine. Fake documents are often used to sell properties that don’t legally belong to the seller.
10. Illegal Constructions: Check if the building has obtained all necessary approvals from local authorities. Illegal constructions can lead to demolition orders and legal complications for the buyers. Ensure that the layout of the property is approved. Buying property in unapproved layouts can result in legal disputes and even demolition of the property.
11. Non-Disclosure of Liens: Make sure there are no pending loans or legal disputes against the property. Non-disclosure of liens can lead to unexpected financial liabilities for the buyer.
12. Under-Construction Project Delays: If buying in an under-construction project, research the reputation of the builder and inquire about their track record of completing projects on time. Many buyers have faced delays in possession or even project abandonment by unscrupulous builders.
13. Misleading Advertisements: Beware of misleading advertisements that promise unrealistic benefits or amenities. It’s essential to visit the site and verify the claims made in advertisements before making any investment. Don’t buy just looking at the brand ambassador of the builder.
14. Advance Payments without Proper Documentation: Avoid making significant advance payments without proper documentation and legal agreements. Insist on written contracts that outline the terms and conditions of the transaction to protect your interests. Insist on a non-cash mode of payment.
15. Bribery and Corruption: Stay vigilant against bribery and corruption practices that may be prevalent in the real estate sector. Refuse to engage in any transactions involving illegal payments or favours.

To mitigate the risk of falling victim to real estate frauds, it’s advisable to consult with legal experts and conduct thorough due diligence before finalising any property transaction in India.