Homebuyers: Here is how RERA will protect you

With the real estate developers delaying projects, overcharging, and engaging in other fraudulent practices, home buyers are usually left at the mercy of powerful builders. Over 80% of the 25 lakh odd residential projects launched over 10 years have been delayed. Homebuyers put their entire life's hard-earned money to buy their dream house and are ultimately left at the whims of the builder. Currently, homebuyers do not have a point of contact to track the progress of a project, builders advertise and sell ambiguous super built-up areas. To resolve the helplessness of homebuyers, the government has introduced RERA which puts buyers' interests at the forefront. In the RERA era, the homebuyer is the king and the builders will have to ensure compliance to avoid punishment. The National Capital Region-Delhi accounted for most delays, followed by the Mumbai Metropolitan Region. Ahmedabad, Kolkata, Pune, Bengaluru, Hyderabad, and Chennai didn't fare much better. As per RERA each State and Union Territory will have its own regulator and set of rules to govern the functioning of the regulator. Following are how RERA protects you:-
 

Builders need to compulsorily register with RERA

To track down fraud builders and protect buyers' interest, a developer has to register with the regulatory authority before he starts to invite, advertise, sell, offer, market, or book any plot. After registration, all the advertisements inviting investment will have to bear a unique RERA registration number. The registration number will be provided for projects. For the projects that are already ongoing on the date of the commencement of this Act are required to register within three months since 1st May 2017.
 

Limitation on accepting advance payment

To further protect the interests of the buyers, RERA mandates that the developer cannot ask for more than 10% of the property's cost as an advanced payment booking amount before actually signing a registered sale agreement.
 

Restriction on using of funds received for a project

The promoter of the project is required to maintain a separate escrow account for each of their projects and deposit 70% of the money received from investors and buyers in that account. This money has to be only used for the construction of the project and the cost borne towards the land.
 

Track the status of projects, clearances obtained, etc

To bring transparency and accountability and instill confidence in the homebuyers in the builders, builders are required to have trustworthy credentials before commencing any project. They need to register under RERA state authority and submit all information pertaining to clearances obtained from various departments, annual reports, balance sheets, cash flow statements, and auditor's reports.

Assurance of Quality

Homebuyers suffer on account of the poor quality of construction material used by the builders. RERA addresses this issue by ensuring a quality check on the flats constructed by builders. The regulator will ensure protection to buyers in the matter from five years from the date of possession. During this five-year period, if the buyer highlights any issue concerning the quality of construction before the regulator, then the builder is under an obligation to rectify the same within 30 days.
 

Delay in completion of a project

Builders cannot delay the delivery of flats to homebuyers. Projects need to be completed on time and failing which buyers will have to compensate homebuyers with an interest rate of State Bank of India's highest marginal cost of lending rate plus two percent within 45 days of it becoming due.

Speedy redressal of grievances

Any grievance that is brought before the regulatory authority needs to be resolved within 60 days of the complaint.

Why do you need a Lawyer?

The intricate process of understanding property laws and formulating a strategy to get your rights enforced on the property is a complex procedure that requires the services of a trained legal expert. Therefore, it is advised to engage the expertise of a lawyer who can guide you through the process and ensure your rights are protected at every stage. You can also use LawRato's Free Legal Advice service to get free advice on your case from expert property lawyers. Hiring a lawyer can save you from a lot of hassle in the long run and ensure that you and your family reach a favorable outcome which reduces the risk of any litigation or friction in the future. This in turn helps save a lot of time, effort, and money for you and your family.

Advocate Chikirsha Mohanty

4.0 | 2+ user ratings Greater Kailash - 1, Delhi
5 years

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