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What is ROR in Land Records? 

A Record of Rights (ROR) is a single piece of document that contains all the necessary details of a land parcel including extent, ownership, and encumbrance. The ROR document plays a key role in understanding the ownership of the property. This document will soon substitute the puzzling land documents and cumbersome procedures related to land registration and transaction. 

The structure of the document and the information contained varies from one state to the other. It helps an individual claim his right to the property when challenged. In this article, we will explore more about the importance of ROR and why it came into existence. 

What is ROR? 

The Record of Rights or ROR is a primary document that records the property’s transaction from time to time along with the information on how rights on land are derived by the landowner. 

It also comprise details regarding any loans taken by the occupant, details of rights of the owner or the occupant, and if there are any community or government rights on the land. 

The ROR document is also commonly known as Revenue Records as it includes tax registers for the collection of revenue from land. It is maintained with the different officers at different levels. 

Typically, a ROR includes the below information: 

  • Location of the land 
  • The extent of the land inclusive of the total area 
  • Name of all the persons who have acquired rights in the said land 
  • The nature and limits of each person’s rights and liabilities in the land 
  • Encumbrances created on the land if any 
  • Classification of land as a fragment 
  • Other classification and reservations on the land 
  • If the land is used for agricultural activities, details of the same including information about Rabi and Kharif crops 
  • Details of charges of attachment and decrees under the order of the civil court or revenue authorities 
  • Income generated from the land 

Advantages of using ROR 

The introduction of ROR has helped in accessing the land details without going through a bunch of mind-boggling land documents concealing the important information. It has now become an important document to be added to your list while planning to buy a property. It plays a key role in understanding property ownership.  

Below, we have listed some advantages of using ROR: 

  • ROR is an important document to indicate the legal status of the land. ROR includes several classifications of the rights such as homeowners, tenancy rights, the mortgage with or without possession, leasehold rights, etc. 
  • ROR is a handy tool when it comes to identifying the land and establishing its extent 
  • ROR also keeps a record of the crops last grown on the agricultural land 
  • ROR keeps a record of registered documents and mutations. It helps in creating transparency and providing accurate land information under a single roof along with the assurance of data integrity 
  • The money obtained as rent or revenue from the property will be considered legally earned money 
  • Many states have digitised ROR resulting in easy access to land information. Anyone can view property land records and their legal status online to avoid an in-person visit to the revenue office. In case of any discrepancies, the viewer can raise an issue. 

Limitations of using ROR 

We have established how ROR has successfully substituted the tiresome land registration procedures but since there is still a long way to go, it has certain limitations. We will take a look at these limitations below: 

  • ROR is poorly maintained. To combat this issue, several states in India are in the process of digitization 
  • ROR often misses out on the on-ground position. The ROR contains several types of land details including property maps, sale deeds, etc. The ROR documents are maintained across different departments at several levels (district, village, etc.). Since these departments work in silos, the data is not updated properly leading to discrepancies in the land records. Digitization of the ROR process will help in resolving this issue. 
  • ROR are not proof of title. According to a Supreme Court judgement, a lessee will not be entitled to any right on the land solely on the basis of an entry in the revenue record. 

Conclusion 

The primary objective of the record of rights is to collect the land revenue from the person who is liable to pay the amount under the land revenue act. The presence of accurate ROR is important for a smooth system of assessment and collection of land revenue. 

In absence of ROR, it becomes extremely difficult to determine who is liable to pay the revenue over any particular piece of land, and also makes it hard to settle disputes between different claimants of the land. Hence, making ROR a crucial document in the land revenue system. It is undoubtedly a great tool to get all your insights about the property from a single document. 

Title Insurance: A benefit for home buyers

People are used to taking and responding to risks now and then. However, in specific scenarios, we fail to assess the degree of risks involved. This primarily happens in the case of property purchase and legal sectors. Therefore, you must take precautions beforehand and opt for insurance policies that can guard you against unforeseen risks that may cause severe damage to your property. Title Insurance is legal ownership that gives you the right to use, deal with, and dispose of the property. After purchase, the homebuyer shall acquire the property’s ownership or title. However, in many cases, a certain disparity has been observed with regard to ownership transfers. Therefore, title insurance is a necessary measure to secure the system in order to protect you from such hassles.  Besides this, title Insurance comes with various other advantages that you can benefit from. Before divulging further, let us first understand what Title Insurance is exactly. 

What is title insurance? 

Title insurance is a type of security insurance that ensures against invalidity of mortgage loans and any financial imbalance because of a mishap in the title to real property. 

This might arise due to unpaid property taxes, ambiguity in the property titles, a sudden claim of an estranged spouse and many more. 

Title insurance safeguards an allottee from issues during inheritance and uncertainty of the same property title by identifying an already existing or known problem in the title. 

It also helps in claims or defects that may arise due to old unknown complications related to the title. When you have title insurance, you are safeguarded from all unknown holds on property or defects on the title as per the date of your insurance cover. 

Please remember that the insurance is not related to mishaps caused due to forgery, fraud, incapacity, undue influence, incompetency, or an entity to authorize a transfer. 

Benefits of title insurance 

  1. It makes the procedure of real estate finance and credit availability easier 

If your project comes with title insurance, the property’s value automatically increases in terms of collateral quality. This gives a much broader scope to obtain finance from institutions and banks at a reasonable rate. 

  1. Broadens the scope of investments 

When a real estate project has title insurance, it will easily bring in more investments from more institutions and individuals. Title insurance has the power to diminish any inbuilt risks involved while acquiring properties. 

  1. Coverage of insurance 

In addition to compensating the insured against any unexpected defects in the title, the insurer also has to bear other types of litigation costs. It can be an out-of-court settlement expense if sustained by the homebuyer in cases of previous unknown damages in the property’s title. Title insurance lessens the burden by covering many legal expenses. 

  1. Security for the association of allottees and individual 

According to the RERA (Real Estate Regulatory Authority) mandate, the insurance will be transferred to the association of the allottees after the promoters have acquired the title insurance and the premium is already paid. This will be a kind of precaution for buyers purchasing with goodwill. 

  1. Value for time and cost 

It is no hidden fact that when purchasing a property, you need to invest a lot of money. The whole process can be hectic, including all the additional costs. However, you can get full-time support from insurance companies like legal assistance or full-time support for home buyers with an out-of-court settlement. The process of settling disputes regarding ownership takes place in a very cost-effective way. The best part of it is that it is a one-time investment. 

Why should you have title insurance? 

No matter what transactions you are making in real estate, a buyer will always want to have a transparent and marketable title of the property. He or she will want a clear picture of all the restrictions of the property before investing. 

Sometimes local regulations and State laws can cause hindrances in the ownership of the property. Therefore, paying proper attention to the marketable title is very important. Unfortunately, even after double-checking all information and details, there can be unknown mishaps and defects present in the title. 

Title insurance provides the ultimate protection in real estate investments. It gives full coverage against any kind of financial loss happening due to defects in the title or other mishaps and irregularities while acquiring the property. 

RERA has made it compulsory to obtain title insurance. This will now benefit both homebuyers and insurance companies. The legal move will henceforth safeguard any unexpected disputes concerning the title of the property. Thus, property insurance is mandatory if you want maximum security. 

Conclusion 

Homebuyers would not opt for a property investment that is not trustworthy or completely safeguarded. Thus, developers should get title insurance to eliminate ownership-related issues during property construction. RERA has already made it mandatory for developers to obtain this insurance for new and ongoing projects. Title Insurance must become a legal practice so that one does not face issues in future regarding the title of their property. 

Top 5 Affordable Housing Locations in India 

Is the rising price of real estate affecting your dream of buying your own house? With property prices skyrocketing in metro cities like Mumbai, Delhi, and Bangalore, the idea of buying a house sometimes seems far-fetched. However, the residential market is booming in many cities allowing buyers to own a property without compromising on quality. In this article, we will take you through the top 5 affordable housing locations in India that will not leave you in a crunch for money to become a homeowner. 

Although affordability is a relative term, here we have considered the price of the housing unit to be ₹45 lakh or below and the carpet area of the unit as 60 sq meters or below. We have curated a list of top 5 cities which not only offer affordable housing but also a good quality of life in terms of infrastructure, water, electricity, roads, schools, hospitals, universities and employment opportunities. 

Hyderabad, Telangana 

Hyderabad provides the most affordable real estate among all the metro cities in India. This tier-1 city provides world-class infrastructure and a decent quality of life to its residents. Apart from affordable housing, Hyderabad is also a friendly and peaceful city that guarantees a safer living as compared to other cities in India. Another positive aspect of living in Hyderbad is the evenly divided population in the city making it immune to traffic during rush hours. 

The burgeoning workforce due to the ever-growing IT hubs in Hyderabad has been the key growth driver for real estate. There is no dearth of residential projects at affordable prices across several micro markets. The real estate sector continues to grow and has accounted for a majority of fresh projects in the last few years. 

Ahmedabad, Gujarat 

The real estate market in Ahmedabad might not be as scaled up as in other cities but it provides some very affordable housing options for those who choose to live here. There are several reasons why Ahmedabad is considered to be a good option for becoming a first time home buyer. 

Residents of Ahmedabad enjoy a good mix of both worlds – modern and traditional. With some of the top universities located in Ahmedabad, it is also an educational hub. The major growth driver of real estate in Ahmedabad is the huge number of petrochemical industries, oil, gas, and energy industries, and automobile industries. 

Ghaziabad, Uttar Pradesh 

A crucial part of the Delhi National Capital Region (NCR), Ghaziabad is no longer a sleepy hamlet but a key residential area for a lot of the population. It majorly attracts mid-segment homebuyers due to its efficient network of roads and metro connectivity. Areas like Kaushambi, Indirapuram, and Vaishali offer a high supply of ready-to-move residential properties by renowned developers at an affordable price. Buyers looking for affordable housing can easily choose a property in the range of ₹ 30-50 lakhs. 

The government is also taking special initiatives to provide affordable housing to its citizens. The Ghaziabad Development Authority (GDA) has announced the affordable housing scheme under which nearly 12,000 flats will be developed for prospective buyers. 

Pune, Maharashtra 

After Mumbai, Pune is in the race to become the next residential hub in Maharashtra. The city provides an exceptional quality of living while providing numerous affordable housing options by renowned builders. The real estate rates in Pune are much less than in Bangalore. 

The growing IT and manufacturing sector has also led to an influx of the working population in Pune, making the demand for real estate soar high. The maximum supply of real estate is from areas such as Baner, Wakad, Hinjewadi, and Hadapsar with affordable housing available in the range of ₹ 30-45 lakhs. 

Kolkata, West Bengal 

The affordable housing market has emerged in Kolkata in its full glory thanks to favourable government policies and rising real estate demand. Kolkata has always been considered a location with affordable housing and with new competitors in the market, the new housing projects have launched a fresh momentum. Areas such as Rishra, Dum Dum, Barasat, Khardah, Serampore, and Andul are all replete with projects offering apartments and flats in the range of ₹ 20-35 lakhs. 

With the Kolkata Municipal Corporation and Bidhannagar Municipal Corporation working towards improving the city’s infrastructure, Kolkata is likely to witness an upgraded infrastructure in terms of water supply, roads, solid waste management, parks, etc. 

Parting thoughts on affordable housing 

Buying a house is a dream for everyone as it provides safety and security to the individual and their family. To make this dream come true, the Indian government has made some crucial announcements to promote affordable housing. Owing to this, affordable housing has emerged as one of the most dynamic sectors in the Indian real estate industry. Developers have started to come up with smart innovative solutions as they are realising the growing demand for affordable housing. As more affordable housing hubs come up in India, the real estate sector is projected to touch the $1-trillion mark by 2030. 

Electronic Clearing Service (ECS): What is ECS and how does it work 

Taking a home loan or a personal loan requires you to make EMI payments every month without fail. And since we all have busy lives and hectic schedules we often find it challenging to remember the EMI date. Missing an EMI date often leads to a penalty and regular late payments can even affect your credit score. Sounds daunting? Well, it doesn’t have to be. To avoid penalties, the borrowers are offered Electronic Clearing Service (ECS) by banks to ensure timely payments. In this article, we will learn more about Electronic Clearing Service (ECS) and its working process in detail. 

What is electronic clearing service (ECS)? 

Electronic clearing service or ECS is a service provided by banks that allow the electronic transfer of funds from one bank to another. It is generally used to make bulk payments including salary, dividends, payments, pension, etc. ECS is also commonly used for making payments to utility companies such as water, telephone, and electricity. Additionally, it can be used to make loan payments as well as SIP investments. 

ECS is quite beneficial for you if you have taken a loan or have to make regular loan payments. It takes out the stress of keeping track of billing dates by automatically debiting the amount from your account saving you the hassle of remembering. 

Types of electronic clearing service (ECS) 

Electronic clearing service (ECS) is mainly of two types based on the mode of payment: 

ECS credit 

When any organization or institution credits money to your account on a monthly basis, be it salary, pension, dividend, etc., it is called an ECS credit. Through ECS credit, institutions can afford to credit a large number of beneficiaries with bank branches in different locations. 

ECS debit 

When a fixed recurring amount is deducted from your account towards loan payments, utility bills, EMIs, insurance premiums, mutual fund investments, or digital subscription plans, it’s known as ECS debit. ECS debit is highly convenient for users as it not only saves time but also reduces effort. 

How does electronic clearing service (ECS) work? 

The first step to avail of the Electronic Clearing Service (ECS) is to inform your bank and provide a mandate to authorize the institution, which can then credit or debit the amount from your bank account. The mandate will contain the necessary details of your bank branch and account particulars. The institution is responsible for communicating the details of the amount being credited or debited along with the transfer dates. The mobile alerts or messages from the bank will keep you notified of the payment. For added security, as an ECS user, you can also set the maximum amount that one can debit from your account. 

What are the advantages of ECS? 

Electronic Clearing Services (ECS) provides benefits to banks, institutions, and customers equally. Let us take a look at a few major advantages: 

For banks: 

  • Less paperwork: As ECS allows electronic payment transfers, the banks have significantly reduced the paperwork. 
  • Increased transparency: Each and every transaction that takes place is recorded digitally ensuring complete transparency. 
  • Effortless processing: Adopting ECS has made the lives of banks easier as they just have to match the necessary details of the account holder in order to debit or credit an amount. 
  • No errors: Since the entire process is automated, the chances of manual errors have come down. If the details fail to match, the transaction is terminated. 

For beneficiaries: 

  • Fast transfers: With ECS, the customers are able to transfer the amount within a maximum of 3-4 days. 
  • No bank visits: If you have opted for ECS, there is no need to visit the bank physically and authorize the transactions. 
  • Enhanced security: The possibility of fraudulent encashment is almost negligible due to increased transparency. 
  • Timely payments: The payments are debited and credited automatically leading to timely payments and zero penalties. 

For institutions: 

  • Cost-effective: Due to the reduction of administrative overheads, dispatching costs, etc. the institution saves costs through ECS. 
  • Less manpower: ECS helps in reducing the manpower required for printing, dispatching, etc. 
  • Seamless transfer: ECS ensures that bulk transfers take place on a fixed date to a large number of individuals without any hiccups. 

Electronic clearing service (ECS) has made paying bills offline or manually a thing of the past. It has revolutionized the way we make payments and made it easier for users to make recurring and pre-payments. Using ECS can help you lead a more productive lifestyle as it doesn’t require you to write cheques or visit banks every month. With ECS, missing penalties are completely avoidable as the payments are automatically deducted.  

This low-risk, high-benefit service is a boon to customers, institutions, and banks equally. Discontinuing ECS service is as easy as starting it and can be done anytime you feel the need. The Electronic Clearing System (ECS) is your way to a convenient, flexible, and secure payment system. 

Home automation: the next big change in the real estate industry 

Home automation is basically a system through which you can manage all your home electronic devices through automation or remote control. You can control all the functions and features of your house such as lighting, air conditioning temperature, alarm systems, and so on with ease. 

All of these electronic devices must be connected to the internet to facilitate automation or remote control. They are known as the Internet of Things or IoT. 

Home automation allows each of these devices to trigger one another which means that you no longer need to control them manually. For instance, you can schedule your lighting systems so that they can turn off accordingly when you go to sleep or you can regulate the house temperature using a thermostat to switch on the air conditioning maybe an hour before you return home from work. You don’t have to return to a hot or stuffy home and feel relaxed without further ado. 

Thus, home automation contributes to making life easier and more convenient. It can also help you save money on electricity, heating, and cooling bills. More and more homeowners have opted for home automation in recent times due to increased convenience as well as safety. Keep reading to know more. 

Understanding how it works 

The home automation system includes a network of electronic devices, all connected to the internet through various wireless communication protocols such as Bluetooth, Wifi, and ZigBee. 

Via electronic interfaces, all these home devices can be efficiently managed with the help of controllers that include either an application or voice assistants like Google Assistant and Alexa. 

Most of the time, these IoT devices have a sensor that is used to monitor temperature, light, and motion changes. This provides the necessary information about the surroundings of the device to the user. They trigger actuators to make physical changes to the device. An actuator is a part that is present in these devices that assists in moving or controlling the device remotely. 

Smart home automation involves three steps- monitoring, control, and automation 

  • Monitoring: Users can keep an eye on their electronic devices through an application. For instance, you can see the live footage of your house through a smart security camera. 
  • Control: After monitoring, the user can control the devices remotely if necessary. For instance, you can pan the house security camera to see more of your drawing or living space. 
  • Automation: Lastly and most importantly, automation is the system for integrating and setting all your devices to trigger each other. For instance, whenever the smart security camera detects some kind of motion, the siren goes off. 

Features of home automation system 

Home automation systems provide many functions and services. We have prepared a list of some of the most common features: 

  • Home lighting remote control 
  • Air conditioning or heater thermostat control 
  • Effective home security and camera monitoring 
  • Control of different home appliances 
  • Carbon monoxide and fire control monitoring 
  • Effective home alarm system 
  • Live video surveillance of the entire home 
  • Real-time email and text alerts 
  • Voice control system 
  • Integration of digital personal assistant 

Advantages of home automation system 

  • Remote control: A home automation system allows remote control of devices. This implies that you can easily unlock the door for your housemaid or plant sitter without leaving the key with someone or under the mattress. Remote access to the lock is undoubtedly more secure and convenient. 
  • Increased comfort: Suppose you are comfortably lying-in bed but suddenly realize that you have left the kitchen or bathroom lights on. This happens to most of us. However, with a smart lighting system, you can now easily turn them off while lying in the bed without having to go physically. 
  • Saving energy: There must have been times when you have left the air conditioning or heater on while you were out of the house for several hours. With the help of a home automation system, you can schedule your thermostat so that energy is not wasted. 
  • Convenience: Smart home automation allows you to control numerous devices remotely or with the help of voice commands. You can also schedule devices such as thermostats, lighting, and so on. Besides this, you can synchronize them with sunrise and sunset. All of these features are bound to make your life a lot more convenient. Just imagine that you wake up in the morning and come down to fresh toast without doing any labour! 
  • Safety and security: Numerous smart home devices can help to increase the safety of your home. This includes sensors for windows and doors, security cameras to monitor and detect motion, and many more. 

Nowadays, most of us are extremely busy and occupied with a tremendous workload. Home automation systems aim to reduce some of the workload and stress by effectively increasing the comfort, convenience, and security of your home. 

What is a home loan with an overdraft facility? Five things to know about it 

There are several factors that come into play during the repayment of the loan. Amongst all the home loan facilities, the overdraft is one of the most prominent ones. It is especially popular among people who wish to pay off their mortgage faster. If you are interested in knowing more about the home loan with an overdraft facility and whether this is the right option for you, keep reading. 

A home loan is undeniably a long-term financial commitment that requires thorough research before opting for one. Banks and financial institutions now offer different home loan options to meet the demands of different customers. 

What is a home loan overdraft facility? 

An overdraft is generally a credit extended by the lending institution wherein the borrower is allowed to deposit funds on top of the loan amount and make withdrawals whenever the requirement arises. The terms and conditions of the usage of the overdraft facility are agreed upon beforehand.   

A home loan overdraft facility is very much similar to this. An account is opened by the lender in your name with the overdraft limit that is usually equal to the outstanding home loan amount. You can repay the loan by depositing the funds in your account. If you make any additional deposit apart from the fixed monthly EMI, it is considered a pre-payment. The excess amount will automatically lower the loan’s outstanding principal and the interest amount. You can also withdraw money up to a certain limit from this account and pay it back with interest. 

How does a home loan overdraft facility work? 

When you opt for a home loan overdraft facility, your current or savings account is linked with the loan account. All the EMIs towards the loan will be deposited in the home loan account. Anything over the EMI amount will be considered as the pre-payment towards the home loan. The excess amount will reduce the outstanding principal amount and hence cut down your interest amount as well. The more you deposit in the home loan account, the faster you will be able to repay your loan amount. Funds from the savings accounts can be directly transferred to the home loan account. 

The overdraft facility allows you to make a withdrawal from the home loan account whenever the need arises. Any amount that is withdrawn will have to be repaid with the applicable interest rate. Withdrawing from an overdraft facility means increasing the home loan principal amount and repaying the borrowed amount with interest. The withdrawal limit from the overdraft is fixed based on the bank’s internal policies and cannot be exceeded. The amount withdrawn from the overdraft facility can be used for personal purposes such as education, wedding, purchase of gadgets, household appliances, etc. 

Five things to know about an overdraft facility 

Keep these 5 things in mind before opting for a home loan overdraft facility. 

  1. An overdraft facility is a credit agreement between you and your bank that permits you to use or withdraw more money than you have in your account, up to a pre-approved limit. Overdrafts are very liquid and the banks will allow you to withdraw money as many times as you wish. 
  1. The line of credit is typically granted based on the account holder’s balance and as pre-sanctioned loans against assets including bank fixed deposits, stocks, and bonds offered as collateral. The approved overdraft limit and the interest rate amount will differ based on the nature of the asset supplied as collateral. 
  1. The overdraft facility gives the borrower the flexibility to manage cash flow. But this benefit can sometimes cost you much more. Overdraft home loans are of higher interest as compared to traditional loans making them more expensive in the long run. 
  1. The overdraft works in a similar manner as a pre-approved loan. You can withdraw the money from the overdraft account whenever needed and the interest will be applicable on the amount withdrawn and for the time duration, it was borrowed. 
  1. Taking an overdraft home loan has many advantages for small business owners and individuals with short-term cash flow issues, however, the negative balance needs to be paid back within a month. 

Conclusion 

A home loan overdraft facility has its own advantages and disadvantages. As the facility is becoming popular amongst borrowers, it is important to conduct a proper cost-benefit analysis before making any decision. The analysis would help in understanding whether a home loan with an overdraft facility is more suited to you as compared to a traditional home loan. 

Generally, a home loan with an overdraft is suited more for individuals who often have surplus funds available with them. Going through the terms and conditions of the lender and weighing the pros and cons can help you make an informed decision. 

How Are Franking Charges Different From Stamp Duty On Home Loans?

Most home buyers, especially the first-time ones, tend to get confused between stamp duty and franking charge. These two terms are often used interchangeably and might create some confusion since there are many differences between the two. Thus, if you are not familiar with them, this article will help you understand the charges better. 

Buying a house might seem like a simple process at first sight- you opt for a home loan at an affordable rate of interest and pay it back in instalments over a fixed period. However, you need to realise that your expenditure is not limited to the property price you borrow or give to the builder. There are many other charges involved. This includes registration, stamp duty, and franking charges. 

What is a Stamp Duty? 

Stamp duty is technically a tax that the home buyer needs to pay in order to legalize the documents pertaining to the purchase. This might include the transfer of the property, mortgage, and sales documents. Stamp duty is in accordance with the tax laws that state that every home buyer has to pay the stamp duty for their property purchase to be legal in a court of law. 

There are certain important things to note about stamp duty. For instance, the charge differs from state to state. In India, the three most common stamping methods are franking, paper-based method, and e-stamping. 

What is a Franking Charge? 

Franking comes after paying stamp duty. It is basically a process of stamping your agreement which confirms that you have paid the stamp duty charges. In other words, when you visit a franking institution or bank, the respective officials affix a stamp or denomination on your agreement document. This is done with the help of a franking machine. The authority charges a certain amount for this process. It is called the franking charge. It is applicable for a home loan as well as property sale documents. 

Previously, stamp papers were used for this purpose. However, the Indian Government decided to discontinue it due to the growing rate of scams, forgery, and misuse. Thus, franking emerged as an alternative for confirming the stamp duty payment. 

Difference Between Franking Charge and Stamp Duty 

Type of Charge 

Stamp duty is the tax levied by the Indian Government on the relevant property documents that are required to legalize the purchase of your house. However, franking can take place only after you pay the stamp duty. It is basically a process of affixing a stamp on the legal property papers used for confirmation of stamp duty. Thus, the charge for this process is called the franking charge. 

Percentage of Charge 

Stamp duty is evaluated based on the total cost of your home. It typically ranges from three to ten percent. The charge depends on a number of factors, such as the location of the house, its type, status, the state slab, the home buyer’s gender, age, and so on. For instance, women generally have to pay around 0.01 percent lower stamp duty in the majority of states. On the other hand, Franking charges range from 0.1 to 0.2 percent of the loan amount or are equal to 0.1 percent of the home value. The maximum value is estimated at ₹ 20,000 on the total sale deed. Similar to stamp duty, the franking charge also varies from state to state. 

Requirement for Franking Charges

Stamp duty is a mandatory tax imposed by the government that has to be paid during registration. Failure to comply will result in a penalty. Franking, on the other hand, is an optional process. Nowadays, people either opt for e-stamping or purchase already-stamped documents. 

Respective Authorities 

You need to pay the stamp duty during the registration process in the Sub-Registrar of Assurances office that falls under your home’s jurisdiction. Failure in doing so leads to a fine. Franking, on the other hand, is conducted by banks that are authorized by the government. Please note that this service is generally provided for a few hours in the day only. Moreover, the banks also have a limit on the franking work done per day. Thus, you have to make sure that either you are able to complete the entire process within the fixed timeframe. 

Conclusion 

Before opting for a home loan, you need to be informed about every miscellaneous charge that is often overlooked by homebuyers. While most people are aware of stamp duty as a mandatory charge during home purchase, the majority of the banks fail to mention the franking charge that comes along with it. Thus, please make sure to check the stamp duty and franking charge of your state before applying for a home loan in order to have a smooth home buying process. 

How Do Smart Contracts Work In Real Estate?

As the name suggests, a smart contract in real estate is an electronic transaction protocol or digital program of a legal agreement. Simply speaking, the respective terms and conditions of a legal agreement are coded into this protocol with the help of an if/then algorithm where one action triggers another. 

Similar to encryption, the content of the documents is hashed by the algorithm, creating a unique key. The unique key acts as an authentication mechanism that ensures there has been no tampering. 

This essentially helps prevent fraud and offers more functionality such as automatic triggers. For example, it enables the automatic release of funds upon the successful addition of the correspondent land registration. However, unless this condition is met, the protocol does not allow for the payment transfer to take place. State governments are actively deploying smart contracts for a plethora of use cases such as degree and caste certificates, along with land records. 

What are the Benefits of Using Smart Contracts in the Real Estate Industry? 

You might ask yourself why you should opt for smart contracts when normal legal contracts have been working well for so many years. You need to know that smart contracts are one of the greatest innovations in Blockchain technology and offer countless benefits. Some of them are listed below. Keep reading to know more. 

Complete Transparency 

Transparency is one of the primary advantages of using smart contracts. The data of your legal agreement is immutable, thus altering or deleting it after its creation is out of the question. Besides this, the data is visible to all the participants involved. The crowd control feature enables it to be stored on a network of decentralised computers and devices, which are called blockchain nodes. Moreover, all the participants can view the complete transaction history which ensures total transparency and avoids any confusion. 

Faster Transaction Speed in Smart Contract

We know that normally, real estate agreements are very time-consuming. The finalization of transactions might take a significant amount of time ranging from a few weeks to even years. However, you can eliminate this issue with the help of smart contracts. Replace all the heel-dragging and red tape with a safe, well thought and precise computerized process. The automatic transaction makes the entire process easy for both homebuyers and even investors. 

Promotes Fractionalization 

Fractional ownership is a system where multiple investors pool funds to buy a property. This is one of the most important aspects of the real estate business. Fractionalization has many advantages. For instance, it makes access to the asset simple, reduces the investment barriers, helps to diversify the portfolio of the investors, and many more. 

Smart contracts help in fractionalization as any property or asset can be divided into several portions which can then be traded individually. Moreover, it does not have a limit on the number of investors who can participate in the purchase process. 

Better Real Estate Liquidity 

The real estate business is known to be illiquid due to multiple reasons such as time-consuming transactions, higher transaction costs, higher hold periods, complicated outreach, and so on. 

Incorporating smart contracts can considerably boost the liquidity of assets as the transaction process would not take many months to finish, fractionalization will help in the trading mechanism and the asset will be available globally. Therefore, it is safe to say that placing bets on smart contracts is indeed a smart choice. 

More Security and Protection in Smart Contract

Most entrepreneurs are incorporating this blockchain-based technology due to its high-security features. The crowd control feature, which has already been discussed earlier, comes with the dual aspect of decentralization and data encryption, thus strengthening security. This lowers the risk of fraud and is evidently a safer choice than traditional legal agreements. 

However, this does not imply that your smart contract is entirely immune to cybercrimes such as hacking. However, if you get hold of an experienced IT professional who can perform tasks such as security audits, vulnerability scanners, penetration tests, and so on, you can be assured that there is no chance of any cybercrime taking place. 

Paper-Free Business 

In the traditional legal agreement system, there is a high chance that the papers are damaged, lost, or stolen. Thus, it is better to entrust your important documents to a safe digital space where there are no possibilities of a breach. Moreover, smart contracts are also economical and environmentally friendly unlike the former. Thus, you are not only saving on money but also contributing to a worthy cause. 

Smart contracts were introduced in the real estate industry many years ago. It has become a powerful and useful tool that has sped up draconian manual document verification and processes. It has countless advantages ranging from better transparency in communication and transaction time, reduced cost, and greater security. As per the records of the Blockchain market globally, smart contracts have revolutionized this industry.

Amazing Facts About CERSAI Charges On Home Loan 

In today’s real estate market, where properties may cost anywhere from a few lakhs to crores of rupees, a home loan is an extremely desirable kind of financial assistance for anybody who is considering purchasing a residential property. The amount of the loan is often 80% of the property’s current market value when obtained from financial institutions in India, such as banks and home finance firms. This means that a buyer may put down as little as twenty percent of the purchasing price on a house. The loan might have a term of 10 to 25 years, allowing the borrower to arrange their payments according to their financial capabilities. Unfortunately, not everything is usually that transparent. A few individuals have taken out several other loans for a residential unit by contacting a variety of financial institutions. This practice is not just against the law, but it also places every lender engaged in the transaction in a vulnerable position. This is where CERSAI steps in to help. 

What is CERSAI?  

Investors in real estate, as well as lenders, have their interests safeguarded by CERSAI, which was established under Section 8 of the Companies Act, 2013. CERSAI is the acronym for Central Registry of Securitisation Asset Reconstruction and Security Interest. 

The Indian government, which owns a 51 percent holding, together with India’s Public Sector Banks and the National Housing Bank, are the principal stakeholders in CERSAI. It encourages more openness in the dealings of real estate transactions. 

It is the goal of this online registration to keep track of all of the equitable mortgages secured by real estate in one place. It also stores lender and borrower information for each property. That’s why each bank that receives a home loan application runs it via CERSAI first to make sure the property hasn’t previously been mortgaged by another party. 

Charges Applied By CERSAI 

Within a period of thirty days after the closing of a contract, it is mandatory for every financial institution to register the particulars of every newly-mortgaged property, regardless of the kind of loan. Evidently, this method incurs some costs, but they are negligible: Rs 50 for all residential mortgages with a balance of less than Rs. 5 lakhs and Rs 100 for housing loans with a balance of more than Rs. 5 lakhs. 

Principal Aims of CERSAI 

Due to an inefficient registration process, a property’s ownership and lending status depended on the good faith and diligence of the debtor and the creditor before CERSAI was established. CERSAI was thus established with the purpose of: 

  • Assisting the lending institutions in maintaining a heightened awareness of the current standing of a property’s existing liabilities. 
  • Keeping a centralised register of mortgages that are in good standing. 
  • Recognising and monitoring any deceptive practices that may be associated with financing over equitable loans. This will discourage individuals from taking out too much borrowing from a variety of lending institutions on a single property. 
  • Protecting potential purchasers from being victimised by bogus sales, which occur when householders attempt to make an unethical sale of property while still having outstanding debts linked to it. 
  • Making it possible for banking institutions, mortgage companies, and non-bank finance houses to record any transactions that involve the reconstruction or repossession of assets. 
  • Registering mortgages and security interests on intangible assets like book debt in India. 

Access to the CERSAI 

Any person, bank, or finance company may use the CERSAI registration platform for a modest cost to guarantee outstanding accountability and to safeguard all parties involved from any illegal transactions. 

It is the responsibility of a lender to check the property records before approving a loan to a consumer to make sure that a previous lender has not developed a security interest in the property. 

Additionally, prospective property buyers may utilise the site to find out whether a house they’re considering purchasing is clear of any debts or loans from previous owners. 

How to Register for it? 

One may easily register with CERSAI using the organisation’s official website, which makes the process quite straightforward. After you have found your way to the website, proceed with the following steps: 

  • Completion of the “Entity Registration” section’s online registration form is required. 
  • You will need to fill out your personal details and digitally sign the form using their Digital Signature Certificate 
  • Then, print out the forms and sign them. 
  • Finally, forward the completed and signed paperwork to CERSAI’s address. 

Conclusion  

CERSAI has become a vital tool for lending institutions as well as legitimate property investors who want to guarantee that the house they’re purchasing or indebting is clear from any past debts or irregularities. Before making an offer on the house, be sure to do a CERSAI check on the property to get all the pertinent information on prior borrowers and lenders. 

CERSAI is now at your fingertips; you should carefully consider your options when purchasing your next house. HomeCapital can help you make the first move toward becoming a homeowner with interest-free down payment loans.  

List of Reasons Why You Should Buy a House in a Smart City

With a growing population and cramped living conditions in urban areas, government agencies are investing in new technologies as a possible solution. A new generation of “smart cities” is on the rise, promising to enhance the quality of life for residents. There is no doubt that they are a better option for anyone looking to purchase a new home. Listed below are some of the advantages of living in a smart city. 

What is a Smart City?  

In order to minimise the consumption of resources, waste, and overall expenses, a city is labelled as “smart” if it uses information and communication technology (ICT) to improve urban services like electricity and transportation. Using smart technology and smart home design can help you to lead a better life in the smart city.

Reasons for Buying a House in a Smart City  

The following is an explanation of the seven reasons that contribute to the desirability of settling down in a smart city: 

A 24-Hour Power Supply 

The usage of smart grid technology in smart cities ensures that there is a constant supply of power available. In addition to that, they are equipped with high-tech prepayment metres that allow residents to keep track of the amount of electricity they use and monitor the system’s overall efficiency. You may simply lower your power usage in addition to keeping an eye on it by disconnecting the power source right from your smartphone while you are away from home.  

Unbreachable Security 

A smart city incorporates cutting-edge precautions into its infrastructure. It is conceivable that the residences in a smart city would be outfitted with surveillance cameras for round-the-clock supervision. In the event that an illegal vehicle is seen approaching the facilities, its position will be followed, and it is possible that it may be denied access. There are a variety of methods that have been used to improve the safety of the general populace, including helplines, panic buttons, car identifying systems, and others. 

Inclusive Water Supply 

The management of water in smart cities works toward using water in a responsible manner without wasting any of it and guarantees that all the people get an equal amount of water. A number of preventative measures, including the installation of water metres, have been taken to locate water leaks and to guarantee that water has not been stolen. Rainwater collection is another method that smart cities utilise to guarantee the use of fresh water in a sustainable manner. 

Reductions in Traffic Jams 

To assist you escape traffic jams, computerised traffic lights in a smart city show you current traffic conditions and other routes. As a result of the usage of monitoring equipment, residents are also informed about bus services and parking spots that are available to boost the flow of traffic. 

Better Infrastructure 

In smart cities, predictive analytics technology is used to dynamically identify the key issues, such as potholes on roadways, outdated structures, or weaknesses in facilities that need to be repaired. In the event of a major infrastructure breakdown, smart sensors warn the appropriate individuals. As a consequence, you’ll save a lot of money on your taxes while still being protected. 

Cooking Gas Management in the Smart City

When you live in smart cities, you won’t have to stress about running out of cooking gas since it will be delivered straight to your front door. In addition, there is an automatic system in place to check for leaks, which further protects you. If there is a leak in the gas line at any location, it will be simple to find it, and the damage may then be repaired. 

Environmental Impact is Reduced 

Smart cities are putting up a fight against the growth of greenhouse gases, pollution in our waterways, and waste in our neighbourhoods. With the advent of green technologies like energy-efficient construction, air quality monitors, and renewable energy, smart cities now have new means of reducing their environmental effects. 

Installing air quality sensors all across a city, for example, may offer data that can be used to monitor peak periods of poor air quality, identify sources of contamination, and then provide predictive analytics that is required for authorities to formulate action steps. Even in the most densely populated places, these detectors may help establish the groundwork for lowering air pollution, which is certain to save lives, given that pollution-related illnesses take millions of people’s lives every year. 

Conclusion 

Since your home is meant to be a refuge for you, it is essential to look for one that is not only situated in an area that makes it easier to live in but also provides maximum comfort and a sense of calm to its inhabitants. You can count on us at HomeCapital to help you get your hands on the home of your dreams with our home financial assistance products.  

Our home down payment assistance is the best option for meeting all of your housing needs and requirements. We provide down payment assistance that is not only fast and simple to get but also interest-free, up to fifty per cent of the total amount of the home’s down payment.