A General Guide to Buy a Plot for Constructing House to Avoid Any Fraud/Problem
Many queries received w.r.t SOPs for buying a plot. Below are some tips, if taken care can save your time and can help in keeping away any problems during/after a deal.
1. 1st Check by yourself that plot physically exists on ground and there is no physical activity construction/excavation on plot that you are about to buy.
2. Confirm any preexisting liability/fine from Society/ relevant city housing authority
3. If owner is offering of to buy plot on a very low price as compared to market, rather being happy and just making the deal , just stop and take time to chalk out the reasons 1st.
4. Always negotiate/deal with Owner not with his any representative/ nephew/son or anyone else.
5. Always ask for latest/fresh (not older than 2 days max) FARAD for record and get it verify by your self/through your property dealer from land record office/ revenue office and assure that no court order/ bank guarantee is there against that property. Any court order/bank guarantee is specifically mentioned at FARAD.
6. If there are more than 1 owners of same property, it means inheritance not executed yet, simply cancel the deal.
7. Whenever you are making an AGREEMENT TO BUY with seller, always use proper value stamp papers, e.g. if you are about to do an 10 Marla deal then agreement stamp paper value can be estimated as;
PKR 1200 × 0.1% of Plot Value
e.g. if Plot Value is PKR 30 Lakh, then stamp paper that shall be used to make an sale agreement shall of following value as per above formula;
PKR 1200 + PKR 3000 (0.01% of 3 Million) = PKR 3200/-
i.e. essentially make sale agreement on stamp papers of value PKR 3200.
8. Once agreement in step 7 is ready essentially get it registered in revenue office commissioner (approx. cost PKR 5000) or as a minimum with Notary public register (approx. cost 1000PKR). An agreement has no value unless it is registered and cant be presented in court of law if it is not registered, e.g. if you have paid PKR 5 Lakh in advance and have plan to pay PKR 25 Lakh within a month and seller died before you have done final payment then your 5Lakhs can be waste if legal hires of deceased deny the deal. AGAIN AN AGREEMENT (even on stamp paper) BUT NOT REGISTERD HAVE 0 VALUE in LEGAL WORLD and if seller deny this agreement at any stage it’s not possible for you to take back your advance money or prove it anywhere.
9. Essentially mention Token/Advance Pay order No/Cheque No in agreement and only then handover the pay order/cheque to seller.
10. Never do a deal with person who have agreement for plot deal but property not transfer yet to his name.
11. It is always better to get service of professional good lawyer an giving away 5K or 10K PKR amount as compared to deal of 50 Lakh or 100 Lakh is nothing, but your all legal sides will be covered.
12. Never buy an plot i.e. still only in file. Even for investment purpose, an file based plot is not recommended at all as same file can be sold to 3 or 4 person even with duplicate and your money will be trapped and precious time will be wasted in litigation.
13. Always pay in form of pay order, avoid Cash transactions due to security reasons and FBR audit objections.
14. When registry documents are prepared, mentioned final amount pay order number in that before seller and buyer both appears in front of Magistrate for final transfer/ mutations.
15. Once you got registry, essentially get an FARAD from land office for record as evidence that property has been transferred on your name.
16. Hold 50% commission of property dealer until you got FARAD that indicating you as owner of that property.
