Entrusting land to a builder for development

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Readers, welcome back! In this article, we’ll see what precautions need to be taken while giving land to a builder for development. Maharashtra is still ahead of other states in the race for development. Large scale housing projects are being set up by developing properties in towns, corporations, and neighboring villages in the state. Builders are acquiring land for development and construction, thus this article is expected to improve the landlord’s understanding of what information should be gathered and what precautions should be exercised while giving land to a builder for development.

Gather the following information and documents regarding the Property.

• All 7/12 Extracts/ Property Card
• Zone Certificate
• Previous Land owners and their Identity Proof
• Search Report for last 30 years
• FSI Percentage i.e. what percentage of the total land area is permissible for construction.
• If the plan is sanctioned then how many flats can be approved, how many parking can be approved.
• Maximum construction can be done by purchasing additional TDR or FSI.
• According to the sanctioned plan, if 15% have to be reserved for the facility area and internal roads, then such area has to be transferred to the local authority, in return if FSI is received, then information about it.
• This Article is recommended for you : While incorporating name on 7/12 extract.

Don’t be hasty in entrusting land for development. It never causes you any harm. With the above information, it is possible to secure higher pay while negotiating a development agreement.

The following should be included in the development agreement with the builder:

• The total number of constructions will be traded for land.
• In exchange for land, a residential and commercial area will be traded
• Deposit / security deposit
• Obtaining construction approval, the duration and date of commencement of construction, as well as the date of completion, should be clearly stated.
• A specific reference to the compensation in the event of a construction delay.
• The facilities provided in the project, their quality, quality of materials, material supplier companies, facilities and capacity of materials should be clearly mentioned. If additional amount has to be spent for this, it should be clearly mentioned.
• Additional FSI rights should not be awarded to the builder. In the event of a change in government policy, the rights to the Additional FSI should be reserved.
• See this to protect yourself from being victim of scam.
• The Development Agreement shall include a provision that immediately after the approval of the construction plans, the flats in lieu of consideration should be transferred through the registration of a Deed of Declaration / Assignment Deed.
• If a builder wants to transfer development rights to other developers, he or she should not be allowed to make that decision on his / her own. It should be clearly mentioned that such a decision should be taken only after consultation with the land owners.
• The right to sell the flats in lieu of consideration should not be granted to the builder.
• All financial transactions should be done through the bank. Cash transactions should not be done under the pretext of tax savings.
• If you want separate buildings as a landowner, it is best to get a separate building plan approved. All possible future disputes are eliminated. Make such provision in the development agreement.
• Click here for Legal Way-out.

Take note of the following details regarding the builder before signing the Development Agreement.

• To understand the builder’s financial state, examine the builder’s and company’s balance sheets for the last three years, and make practical judgments without succumbing to the acquaintance, friend of a friend, or anyone who expects any such emotional hope. Don’t be afraid to say no.
• It is advised to pay a visit to the builder’s completed project and discuss with the respective project land owners. Also get information by discussing with the flat owners there. Did the project get completed on time? Has provided Facilities? Has the landowner been deceived? Get to know their experiences.
• Rather of the builder’s sweet talk or verbal assurances, rely on the paperwork.

The development agreement is a very important document to make the transactions more secure. Development Agreement should be done only after consulting an expert. The expense is not prohibitively expensive; rather, it is an investment.

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