Agreement For Advance Payment For Purchase Of Flat

Prepayment in a real estate transaction is very common. Just to clarify that I`m not referring here to the advance or token money to launch a real estate deal. He must pay a token or an advance, otherwise there is no financial obligation of the end of the buyer to conclude the real estate activity. I discussed the quantum of token money in my article on the same topic and I can vary from case to case. In the idealistic scenario, after the payment of the money from the tokens, the buyer should only make the remaining payment at the time of registration of the property. Unfortunately, we do not live in the idealistic world. In addition to token money, sellers/banks sometimes require additional advances in a real estate transaction under different heads. Either way, since this is a complex process, buyers often resort to the help of banks, especially when using housing finance for the purchase to deduct the SDT. A typical trend for financial institutions is to withdraw the TDS before the transaction has actually taken place. Even if the amount is not very high, your money would remain stuck for a long time if the deal disintegrates. In some cases, the seller acts in the event of a street hit and tells buyer A to pay a deposit in a real estate transaction for their home loan before closing. The probability of fraud is high in this case.

The seller will close his house from the means of buyer A. The seller receives original documents from the bank. Subsequently, the seller will sell the property to another party, for example. B buyer B. Now, legally, the same property is sold to buyer A and buyer B. The seller receives nearly 1.5 to 1.8 times the sale value and buyer A & buyer B fight for the property. The rule of thumb is that as a buyer, you should not pay more than 20% of the value of the property to the seller before the property is registered. The reason for this is that the amount paid is higher, the risk is higher for a buyer. In my article, 5 points that a real estate buyer should not tell a seller I shared that you should not share the percentage of funds that you will raise from your own sources. In a recent request from one of my clients, he planned to pool 70% of funds out of his pocket and used 30% as a mortgage. . .

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