Information for selling resale property in installments
I have only one own property (I am not an investor) and have put it on sale as I have been transferred to new city and want to purchase in new city. Apartment is already 7 years old now.
Now, one person has approached me and asking to purchase my property but she is not eligible for home loan. So, she is asking me to sell apartment where she can pay in installments for 1-2 years or so after doing Down-Payment for 30%-40%.
Can you let me know if the buyer looks genuine? Why she can not get loan but ready to pay high amount like few lakhs every month to me. What Precautions I should take to see that some fraud is not happening? Can I make "Agreement to Sale" first and then do "Sale Deed" only after complete amount is received?
Even if we get into "Agreement for Sale", there may be few questions related to contract:
1. What if she fails to pay after few installments - Should I just return whatever she deposited without interest or need to pay anything else?
2. How can we make it time-bound. For example, she has to complete within a year or else its cancelled. I can not wait indefinitely for her to complete sale.
3. By that time, apartment is on loan for me. Can I close my home loan with received down payment? Or should I wait for complete sale deed. In future, if deal is cancelled, can I get loan against property to pay her back?
4. Right now, apartment is on rent. So, who should be receiving rent by the time deal is complete?
5. What about tax liabilities here? Do I need to pay tax on received money immediately (long-term capital gain or so?). What time I may get to reinvest in different property in Pune? Or by that time, can I put it in some Government securities to keep liquidity open but still not paying tax?