How to get property with a clear and marketable title

During the process of acquisition of property, taking a legal opinion is an important constituent of the due diligence exercise. Legal opinion is the opinion given by a legal expert on the property transaction. The knowledge of individuals on the nitty gritties involved in the property acquisition is limited. Property acquisition is a complicated process. There are number of laws, rules and regulations covering property transactions. An ideal and reliable source of legal opinion is an advocate who specializes in property matters.

Getting the legal opinion is all the more important in case you are planning to purchase an old property, that is a property from an existing owner rather than a property developer or builder. There may be many issues. The property may be held jointly, or the seller may not have proper title or authority to sell the property. The property may have already been sold by the seller or it may be encumbered, that is a charge already created on the property.

It is difficult for an individual purchaser to check out on all these areas. As such, it is better to take the services of an expert in the matter. Although a purchaser can do an initial review of the documents checked by legal expert.

Scanning through property documents is a complex process. Land records are generally in a local language. The purchaser needs to go through a number of documents to trace the ownership of the property. The legal experts are better placed to review and give their opinion on the status of the property.They can be asked to prepare a search report.

The search report traces the history of the property, that is who the original owners of the property were and how it has been transferred over time before reaching the present seller. It also traces out any charges or encumbrances created on the property and the present status, That is whether the charges have been paid and the property released or if there are some charges pending. This search on the title of the property is for a period of the past 30 years.

A seller should annex a copy of this report to the ‘agreement for sale’ with the intended purchaser of the property. It would state whether or not there is any existing mortgage, litigation, condition or claim, which is likely to affect the title of the buyer adversely.

A legal opinion covers details regarding the status of the property, such as who the legal owner of the property is, what has been the chain of holding and transfer of property, whether the property is free from encumbrances, whether the property has been already offered as a security for loan, is there any dispute on the ownership of the property, whether the seller has complied with all the requirements for getting the ownership of the property, whether the seller is competent to transfer the property etc.

In case you want to avail a housing loan, the title of the property should be clear and marketable, that is the seller should be the genuine and actual owner of the property. Also, the property should not be under any dispute or litigation.

A search report and title certificate can be obtained from an advocate who will conduct a survey of the title of the property by visiting the office of registrar. A legal opinion reduces the chances of getting into disputes at later stage. It acts as a safety device for purchasers.

In case you are getting the property purchase financed by bank, generally the bank will obtain a legal opinion before sanctioning the loan. The bank will have its own legal experts who specialize in this field. The cost is nominal and is built up in the processing and administration charges applicable for sanctioning and disbursing the loan.