Complications due to unregistered notary
KMRaoKMRao
(Querist) 07 July 2013
This query is : Resolved
Sir,
My father gave a piece of property to my mother via notary(not registered) long time back. My dad passed away in 2004, the notary was still not registered. Last year my brother went into a huge financial crunch n requested to sell his share, my mother decided to divide the property among me n my brother with mutual consent n got them registered on our names(gift deeds with mutual consent). Now my brother is selling his property to clear his debt. The buyer says even me n my mom should sign on the papers else they will not get any loan on the property. My brother says the same thing will apply to my share also in case i want to take a loan or dispose the property at a later date. What do i do? My brother is planning to move to australia for good after the deal n mother is terminally sick. Pls help. The deal is scheduled in august 2013.
Regards,
K M Rao.
ajay sethi
(Expert) 07 July 2013
it appears gift deed has been made by your father for immoveable property . however the said document has not been stamped and registered . for a document to be admissible in evidence it needs to be stamped and registered and posession delivered to donee .
although your mother has executed a gift deed in favour of her 2 sons and got the same registered as a matter of abundant caution the buyer wants your mother to be a vconfirming party for the sale .
KMRaoKMRao
(Querist) 08 July 2013
Thanks a lot for the reply. But is it true that banks would refuse loans for the above mentioned property? If yes, what is the precaution that i should be taking to avoid that situation.
Devajyoti Barman
(Expert) 08 July 2013
Yes, if you put your signature in the loan application of the borrower, the loan would be granted.
To prevent this hassle you can make a registered partition deed among yourselves after which you need not put signatures for loan application of buyers.
Anirudh
(Expert) 08 July 2013
One time you say that your brother is trying to sell his portion of the property. On the other hand you say that the bank says that they will not grant loan unless you and your mother sign.
First you have to clear the doubt - whether your brother wants to sell his portion or he wants to obtain any loan on the basis of his portion of the asset.
If it is for sale, then any signature by you and your mother would mean that YOU ARE ALSO SELLING AWAY YOUR PORTION OF THE PROPERTY. (I think you are not interested in selling your property.) Therefore be careful.
If your brother is only trying to get loan against his portion of the property, then at best you can be a guarantor for your brother and as a security, you can offer your portion of the property. (HERE ALSO, BEWARE THAT IN CASE YOUR BROTHER DEFAULTS TO REPAY THE LOAN, YOUR PROPERTY WILL BE TAKEN AWAY BY THE BANK AND AUCTIONED.)
Therefore, you have to be very very careful in both the situations.
If you want to save your portion of the property, then the best way is to divide the property by metes and bounds (i.e. by clearly dividing the property showing the boundaries) between you and your brother. In that case, your brother can do whatever he wants to do with his property. In that Case YOU WILL NOT BE CALLED UPON BY THE BANK OR ANYBODY TO SIGN THE DOCUMENTS THAT YOUR BROTHER ENTERS INTO. (This is what Mr. Devajyoti Barman advised you.)
KMRaoKMRao
(Querist) 10 July 2013
Thanks a lot to all the experts who tried to help me out. I am sorry if there has been any ambiguity in my query. Hence I'll divide it into points so that all my queries are clear in the first place.
1. My brother wants to sell off his property not me. My brother loves me dearly and he is NOT trying to take away my share.
2. Our share of properties are already registered on our names with the boundaries and all other details.
3. The point is the buyer(my brother's buyer) says me n my mother have to sign a no objection for the sale of his(my brother's) share else he(the buyer) will not get a loan from the bank in the future.
4. Me n mother signed as witnesses to his(my brother's) share of property.
5. My brother on the other hand was not present for the registration of my share and hence left a GPA stating he has no objection to my mother dividing my father's property into two and registering that particular(along with boundaries) share to me.
6. Now, my brother's buyer says he will not get a loan from the bank unless me n mom sign a no objection and my brother suggests I might have to face the same problem in the future.
Anirudh
(Expert) 10 July 2013
Please note - as per the information given by you so far, the property is still in the name of your father. The piece of paper notarised (not registered) has no value at all.
Therefore all of you i.e. your mother, you and your brother have equal share in the said property.
In the absence of partition, none of you can say with certainty, as to which portion of the property belongs to whom.
Therefore, none of you can sell the property (which you say as share of your brother etc.) to anybody individually.
That is why the buyer says that you and your mom should sign on the papers. (PLEASE NOTE, THE MOMENT YOU AND YOUR MOM SIGN THE PAPERS, you will be conveying the entire property, NOT ONLY THE SHARE OF YOUR BROTHER!).
Therefore, consult a lawyer before signing any papers.
You also please indicate whether the property which you are mentioning is a house property or a land.
If it is a house property, whether it is capable of being partitioned with clear demarcation so that you can say that this portion belongs to your mother, the other portion belongs to you and yet another portion belongs to your brother etc?
KMRaoKMRao
(Querist) 11 July 2013
Thanx a lot for your reply sir. But, it was a bouncer for me. Anyways, I'll try to be more clear this time.
1. My dad was an advocate n the property I mentioned was a self acquired property. It was a piece of land which was demarcated for the members of the bar association.
2. My father then gave a notary to my mother and we built a house on it which was registered on my mother's name.
3. My mother is terminally sick and she decided to divide the property equally between me n my brother.
4. The land is 600 sq yrds. The house occupies around 330sq yrds. It's been more than 30yrs that we built that house.
5. Since my brother wanted to sell his share, my mother decided she'll give the house to me since she didn't want to dismantle it.
6. I was told to give the differential amount to my brother in cash. Which was agreed mutually.
7. We got the open plot registered on my brother's name and the plot with the house was registered to me in the fashion that I mentioned in my earlier posts.
Please consider me a novice in the field of law and let me know what to do next.
Anirudh
(Expert) 11 July 2013
My sincere advice to you would be - please get in touch with a local lawyer who is well versed in property matters; show him all the documents that you have and then go ahead as per his advice.
