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Procedure to remove name from Agreement of house - unrelated people

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Procedure to remove name from Agreement of house - unrelated people

Last updated: April 13 2017
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  • Procedure to remove name from Agreement of house - unrelated people

    Hello,


    My friend and her boy friend were supposed to get married. Hence, they decided to buy an under construction house. The agreement to sale was executed and the required stamp duty was paid. (First name of the Boy and second name of the Girl) The bank also gave a housing loan stating condition that the couple should submit marriage certificate at the time of third disbursement. (the guy being applicant and girl being co applicant)

    However, the couple has now called off their wedding. They have decided that the girl will keep the house. Till now 2 disbursements have been done.

    Now, they wish to remove the guys name from the agreement. Can anyone tell me exact procedure for this? How much stamp duty is to be paid? OR can this be done by any other way where less money is required?

    The flat has been registered in Pune and entire stamp duty and registration cost has been paid at the sub registrar office at the time of executing the agreement.

    Please guide on the process how to remove one name from the agreement.



    Regards,

    Ady
  • #2

    #2

    Re : Procedure to remove name from Agreement of house - unrelated people

    In such cases, you need to do a 'gift deed' where the girl would receive the full ownership of the flat as way of gift from the boy. As joint owners, they hold 50% of ownership. Since they are not related, stamp duty + LBT etc would be calculated on 50% of the flat's today's ready reckoner value, irrespective of purchase value. How this affects in her taxes, some CA can clarify. Since they are not related, gifts above 50,000 would attract taxation.

    Since this flat is under loan, I think you will need bank's consent to do such transfer, as the loan too would be on the joint capacity of both of them, and if girl can't have enough funds to pay EMI, bank may even deny to give such permission of gift.

    You will need a lawyer who can draft gift deed or get refund of stamp duty and a CA who can further guide for tax implication for the girl.

    Comment

    • #3

      #3

      Re : Procedure to remove name from Agreement of house - unrelated people

      Release deed will be needed.Banks will have to review loan amount and additional security etc.

      Comment

      • #4

        #4

        Re : Procedure to remove name from Agreement of house - unrelated people

        As far as i understand, an affidavit has to be submitted by the co-applicants to the Builder for removal of a co-applicant . Once the Builder removes the name & issues a new document/agreement in a single name, the same has to be presented to the Bank for rectification of Loan documents .


        A remember a case of a friend who had a similar issue . He and his mother were co-applicants and later he wanted to take out his mothers name from the agreement . This was for a Builder/Project based in Gurgaon .
        Please read IREF rules | FAQ's

        Comment


        • vaibav123
          vaibav123 commented
          Editing a comment
          Was the agreement registered at the time of changing names?

        • MANOJa
          MANOJa commented
          Editing a comment
          Not sure, i think it was not, but i would need to check . U may be right, what i said could be true for an agreement which has not been registered yet .
      • #5

        #5

        Re : Procedure to remove name from Agreement of house - unrelated people

        Thank you guys for reply. The agreement was registered and stamp duty was paid. Also, is gift deed possible in Maharashtra between unrelated people? I thought gift deed is possible only between persons who are related. Also, if gift deed is the only way, then does anyone know the stamp duty applicable?

        Comment

        • #6

          #6

          Re : Procedure to remove name from Agreement of house - unrelated people

          Just spoke to a lawyer, a Relinquishment deed may be required . Relinquishment deed is a legal document/instrument where a person legally or formally gives up or releases his legal rights of the said property being relinquished in the name of some other person . This is one of the modes of transferring rights of an immovable property .


          Normally, this Deed is executed on Rs 100/- stamp paper ( Haryana & Himachal ). It could be similar for Pune .
          Please read IREF rules | FAQ's

          Comment


          • vaibav123
            vaibav123 commented
            Editing a comment
            Relinquishment deed has to be registered and stamp duty paid.
            Gift deed will not be applicable here as there is no relation between parties.
            In case of relinquishment deed -when you are relinquishing property for monetary consideration, it will result in capital gains for the transferor. If the consideration is less than the stamp duty value of the property, the difference between the stamp duty and the consideration will be taxed in the hands of the buyer. If you relinquish it without any consideration, the stamp duty value of the property will be its sales price.
            Exact rate of stamp duty can be confirmed from a good lawyer who can be used to draft a fool proof relinquishment deed and have it registered duly.
            Keep builder duly informed in writing.

          • MANOJa
            MANOJa commented
            Editing a comment
            What i was told is that the Relinquishment Deed can have zero value, meaning somebody just relinquishes his rights to the property .

            I think it is better to discuss this with the Builder & a Lawyer, so that everything goes off fine .

          • vaibav123
            vaibav123 commented
            Editing a comment
            Relinquishment deed need have any consideration and cannot be done other than to co owner like in this case.
            Sec17 of Transfer of Property Act 1908 is relevant here
            http://www.livemint.com/Money/1jN2Su...lications.html
            Querist needs to take help of a lawyer and do the job professionally.
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