Is it advisable to purchase a property if the title papers are lost?

Always ask the seller for original documents before you close the deal. Avoid buying a property that has the original documents lost or damaged in any way.

Why?

 If the seller has lost all the original papers, he may have only certified copies, newspaper advertisement cuttings showing missing property documents, and a receipt from an FIR filed in the police station. This will not help. You will be the loser.

Without original documents and a clear title of the papers, it is wise not to make any real estate investment.

Banks will not sanction any loans without clear original documents. 

If the original property documents are not available, banks and housing finance firms are unlikely to lend money to buyers. The reason is that there might be a chance that the owner of the property has mortgaged it. The purchaser may lose their money and be liable for a loan if he disappears. A cheater may have already sold the property and could be living in the property as a tenant, pretending to be the owner.

If the original documents are not available, people can scam you in many ways. It can be costly and time-consuming to inspect and verify the documents and credentials of the owner and property without the original documents.

There may be situations where the original title is not available.

If Seller is known to you, your friend, or a trustworthy relative., then you can consider a purchase. It doesn’t matter if one or two papers are missing.

Bank verification and valuation

Before you make any decisions, it is a good idea to approach a bank for a loan. Each case is unique, and the bank will decide to lend money in these situations individually. The outcome will usually be favourable if the seller/buyer and the borrower know each other well. A bank official will inspect the property after the approval of the application.

 First, the bank panel advocate will verify all documents associated with the property and the records from police complaints. He will then verify that all duplicate documents are authentic and not forged. The bank will investigate the seller with due diligence and ask to complete KYC.

Newspaper advertisement

If the property of purchase is of a significant value, you should publish details about the property in at least two newspapers, national and local. It would help if you highlighted that they could contact you in case of any objections or any heirs. The bank might ask the seller and buyer to sign separate agreements to give the bank the original documents if they are found.

The bank may approve the loan if the formalities mentioned above are met. However, The borrower is responsible for all expenses in connection with these activities.

How to keep your documents safe

Care should be taken when storing property documents as a homeowner.

It is best to apply for a bank loan so that the bank can keep the documents safe. You can apply for a bank locker to keep your property documents safe if you haven’t taken a home loan. Despite these precautions, you can still lose property papers during travel or other mishaps.

You don’t have to sell or purchase a property if you lose the original documents. You can still settle the case in this situation, but it will require more paperwork and lead to higher costs. It can surely be cumbersome.

How do I get duplicate documents?

 – You should file an FIR at your local police station informing them that you have lost or misplaced important documents. Also, request a copy of the complaint. The bank usually keeps property documents safe, but the bank may lose them in some rare instances due to negligence by bank officers. The bank will need to file the FIR in this instance. The seller should provide a copy of this FIR to buyers.

 – An advertisement describing the loss of documents will be a requirement in both an English daily newspaper and a regional newspaper. The property buyer may also place an advertisement for the loss of documents. He can call any claimant within 15 days after publishing the advertisement.

– Some property documents include a lease deed issued from a development authority and a sale deed that is registered in the sub-registrar office. Each case is exceptional and requires different tactics to handle. 

 – If a property is a flat, the owner can request a duplicate share certificate from a housing society. The housing society can also post the application at its meeting. After charging a fee, the housing society will issue a duplicate of the share certificate if the application is approved.

Which  documents and from where to get

The no-objection certification is another document buyers and owners need to obtain from the housing society. Without it, no lender will offer a loan. This certificate is essential for both buyers and owners.

You can only obtain certified copies of the sale deeds for a single plot/house. You can obtain these from the registrar’s offices as they maintain the records for all transactions within their jurisdiction.

The development authorities can issue duplicate title deeds/leases, but they will only be in the name and address of the first allottee. You will need to sign an undertaking on stamp paper stating you have lost all your original documents. The undertaking should include details about the property and the text of the advertisement published in the newspaper. It also must state the number of the police complaint.

The undertaking should clearly state that all details stated in it are true.  A notary will sign, notarize and register the document.  The undertaking, the newspaper advertisement and the police complaint must be submitted. Only then can the development authority issue a duplicate title deed. The deputy registrar’s office holds all details about the property so you can easily obtain certified copies of the sale deeds.

You can expect to pay anywhere from 10000 up to 25000 for duplicate documents. These amounts, however, are subject to vary.