• RERA number is delayed by builder. Should we proceed with payment?

I am trying to buy a flat in chennai (Pachayath board). 

The builder is in this field for 14 years & completed so many projects. 

The link of the project I booked is: https://thenestbuilders.com/nest-mascot-II/. This is 100 units project. 

I booked this around Dec with an initial advance of 5%. The builder hasn't gotten RERA approval yet. When I booked they said it's under process & soon we will get the RERA number. When I ask the builder says it's under process & Gov guys delaying this.

They started construction & said since they have CMDA approval, we started construction. 

So far they haven't pushed me to pay further since most of the balance amount will be loaned. 

When I booked the flat, they committed to pay a monthly rental to me. They started to pay this in Jan 2023. 

My questions are:
But should I pay the upfront balance cost to them? Can I deny to pay further/sale agreement without a loan?

He suggested getting pre-approval for the loan without RERA. What is the advantage & disadvantage of this? In this case, the lending bank, will release the loan amount to them without RERA, will I be in trouble?

How long should I wait for the RERA approval number from them? 

Is it common that RERA is approved, but number allocation is delayed?

Can I cancel my booking & ask for a refund, in incase more delay in RERA? in that case am I liable for cancellation charges?
Asked 1 month ago in Property Law
Religion: Hindu

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5 Answers

no harm in applying for loan and getting it sanctioned 


2)however dont make any further payments without plan s being approved by RERA 


3) no disbursal of loan would be done if project is not approved by RERA 


4) you can cancel your booking if project is not approved by RERA  and seek full refund of money paid by you 

Ajay Sethi
Advocate, Mumbai
90352 Answers
6615 Consultations

5.0 on 5.0

The approval by RERA is likely to be delayed but that does not mean that the builder will start constructing the project without approval.

In any case without any sale agreement it is not advisable to make any further payment.

The builder should not and may not be able to enter into sale agreement without the approval of RERA or even the commencement certificate.

If the property falls within the panchayat limit, what is the CMDA approval doing in this, did you see the copy of the CMDA approval?

What is the approval sanctioned by CMDA?

You may don't accept the rental amount under the scheme, it will be deleterious because after one stage if the builder stops paying the rent then you may not be able to claim it neither the bank or court will come to yor rescue in case the builder defaults.  

The bank will approve the loan but it will directly disburse the amount to the builder, in that case in case of any default in future you would be liable to repay the same and not the builder. 

Further it is not common that the RERA sanctions approval but not allotting the number.

Once the RERA is approving the project, it will pass the orders with the proper details.

If you feel that this project may not be viable or feasible then you can cancel the booking and claim full refund

T Kalaiselvan
Advocate, Vellore
80523 Answers
1730 Consultations

5.0 on 5.0

Dear client 

You should only pay the balance cost if you are comfortable doing so and if the builder has provided all necessary approvals and certifications required by law. Before making any payment, you should check that all legal requirements have been met and that the construction is proceeding as planned.

Pre-approval of a loan without RERA approval is not recommended, as it could be risky. RERA approval is a crucial document that provides important protections to the buyer and helps ensure that the project meets legal requirements. Without RERA approval, there could be issues with the loan disbursal, as well as potential issues with the project's construction and delivery.

There is no fixed time frame for obtaining RERA approval, as it can vary based on the project and local regulations. However, you can ask the builder for regular updates on the status of the RERA approval and take necessary steps

Anik Miu
Advocate, Bangalore
6092 Answers
66 Consultations

4.9 on 5.0

Dear Sir,

It is premature to take such a decision.  Further u have paid only 5% of the agreed sale consideration amount.  Wait for few more days.

Kishan Dutt Kalaskar
Advocate, Bangalore
6103 Answers
419 Consultations

4.8 on 5.0

Yes you can seek refund and cancellation in rera

Prashant Nayak
Advocate, Mumbai
28990 Answers
110 Consultations

4.1 on 5.0

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