• Sale agreement/Sale deed for mortgaged property by GPA/JDA holder

There are 3 land owners who have executed GPA/JDA with builder cum developer. There are 123 Plots ( i.e. plot with house construction). 
GPA holder i.e. builder/developer has mortgaged with a private financer(mortgagee) with registered supplement Deed. Out of that property, small piece of land along with house ( no 2 ) was agreed to sale to me. I am planning to avail bank loan. 

1. I have already booked plot/house no 2. Builder is saying that he will bring NOC from the mortgagee after sale agreement. Builder is asking 20% of Total value (of land and house )for sale agreement and he says that he will submit NOC to the bank for sanction of house loan in my favour. is it lawfully right or wrong ? 
2. Do we need to write any clause in Sale agreement for NOC regarding escrow account of mortgage? Please advise.
3. He says land registration will be done after receiving 90% of total value of building and land. Kindly advise.
Asked 4 years ago in Property Law
Religion: Hindu

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14 Answers

You should take the plea that you are willing to pay 20per cent of total value provided that NOC is obtained by builder from mortgagee.

2) landowners should be confirming parties in sale deed

3) land registration can be done after you make 90per cent payment

4) get your agreement vetted by local lawyer

Ajay Sethi
Advocate, Mumbai
87947 Answers
6207 Consultations

5.0 on 5.0

1. Noc from lender bank has to be obtained before sale agreement and registration

2. Attach noc to your sale agreement

3. The loan sanctioned by your bank may be required tp be deposited in the escrow account maintained by mortgagee bank of builder

4. I think builder has to register project with Rera

5. As per Rera law he cannot accept more than 10% of sale price without first executing and registering sale agreement with you

6. Insist the builder to get Noc from his bank first

7. Your lender bank can also make this requirement and you can tell that to builder that your lender bank wants NOC first

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

It would be better for you to take proper legal guidelines by showing complete files of your case to an advocate so that you can take a right path to handle your issues. Vague answers will not give you the exact relief .

Mohammed Mujeeb
Advocate, Hyderabad
19031 Answers
32 Consultations

4.5 on 5.0

Dear Client,

Without registered agreement builder cannot demand more than 10% of purchase price.

Sale agreement will be on the basis of RERA rules. Draft available in RERA rules.

Complete payment should be on spot while registering sale deed, else sometimes builder turns from their commitment once most of payment received in advance.

Yogendra Singh Rajawat
Advocate, Jaipur
21481 Answers
31 Consultations

4.4 on 5.0

1. This is lawfully right excute a registered sale agreement and mention the condition that the builder /developer shall get NOC for release from the mortgagee within 60 days then.you shall release payment and register property. If builder fails to.get NoC then he pays entire amount with interest at the rate 24 percent and compensation.

2. Yes.

3. if there is registered sale agreement and then NOC is received and bank loan is sanctioned then in that case there is no problem in registration after 90 percent of amount it is safe.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Unregistered sale agreement is binding upon the builder

There should be clause that if he does not obtain NOC within one month of execution of agreement for sale he would refund your money with interest and agreement shall stand cancelled

Ajay Sethi
Advocate, Mumbai
87947 Answers
6207 Consultations

5.0 on 5.0

Pay the 20% but ensure that at time of registration the builder has NOC of his financer and that NOC must be attached to your sale agreement and registered with sale agreement

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

Sir ask builder to get the agreement registered with the sub registrar though a notarized agreement is also valid but it is always better to get registered for safety and there is no problem in future so you can go ahead register an agreement .

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

1. The builder should submit the NOC before you pay him any amount. Rather you should go with the builder to the said Mortgagee bank to collect the NOC by yourself to ensure that the said NOC is not forged by the builder.

2. You should collect a clean NOC from the mortgagee Bank and can sign a tripartite agreement between you, the developer and the said bank by which all the payments to be made by you shall have to be deposited in a escrow account to be opened with the bank which will be refunded to you on demand in case, the builder fails to conclude the sale of the said flat.

3. The balance payment shall have to be completed while registering the sale deed for conveying the title of the entire property including the house constructed on the said land.

Krishna Kishore Ganguly
Advocate, Kolkata
26603 Answers
726 Consultations

5.0 on 5.0

1. What will you do if he refuses to get you the NOC to be issued by the said mortgagee bank after receiving the payment?

2. If his dealing with the mortgagee bank is clean he should not have any problem in getting the NOC from the said bank.

3. After collecting the NOC from the mortgagee bank as advised in my earlier post, pay the amount asked by the developer only while registering the agreement for sale before the Registrar.

Krishna Kishore Ganguly
Advocate, Kolkata
26603 Answers
726 Consultations

5.0 on 5.0

Dear Sir,

If he is a reputed builder then you may believe him. In these days to be frank the builders and bank officers colluding with each other and issuing NOC. It is better to check credibility of builder before entering into such contracts.

==

Kishan Dutt Kalaskar
Advocate, Bangalore
6050 Answers
381 Consultations

4.8 on 5.0

1, Without getting NOC you need not pay any amount towards even in advance to the property.

There is no guarantee for getting NOC by the builder till you have paid him substantial amount and what if the builder is not getting NOC at all?

You can talk to the bank manager about the NOC aspect and can make an arrangement to pay the sale consideration amount to the escrow account of the builder on the bank giving NOC to this flat.

2. You can very well make an endorsement in this regard.

3.You can consult a local advocate on all such further issues because any opinion given without seeing the property documents and understanding the practical situation, it may lead to misguidance.

T Kalaiselvan
Advocate, Vellore
78104 Answers
1543 Consultations

5.0 on 5.0

An unregistered sale agreement is invalid and not enforceable in law.

Further he says that he will get NOC only after payment of 20% amount of the total sale consideration, which is nothing but the builder is availing sizable amount from the buyer also besides availing loan from bank for the same reason.

The builder may be up to some tricks in his sleeves for the future escape route also.

You may enquire about the reputation of the builder properly before entering into any such agreement.

You may remember that the unregistered sale agreement is not valid in law.

Dont enter into any agreement without consulting a lawyer and having his opinion in this regard.

T Kalaiselvan
Advocate, Vellore
78104 Answers
1543 Consultations

5.0 on 5.0

Complain to RERA. Demand is illegal and sale agreement should be registered otherwise not admissible in evidence.

Yogendra Singh Rajawat
Advocate, Jaipur
21481 Answers
31 Consultations

4.4 on 5.0

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