A bill of words...

New Delhi: That inviting ad for your dream home may become a safer bet with the Centre giving finishing touches to a Bill which will make it tough for builders to divert funds or short-change buyers on facilities and quality of construction.

Unscrupulous real estate developers now better watch out: the Bill mandates that the finished product has to match up to the apartment promised in alluring ads.

For starters, the draft Real Estate Management (Regulation & Control) Bill — sent to state governments for their response — intends to ban developers from issuing ads till the project is cleared by a proposed regulator for the sector. Regulators would be bound to clear projects only after ensuring that all title deeds are in place and transaction records for the land to be developed have been examined for the last 30 years.

While the proposed law would be mandatory in the Capital and union territories, it is expected to set the stage for states to follow suit with their own versions. Some states have already enacted laws and the central Bill would be a model.

Once a project has been approved, builders will be barred from accepting any advances or deposits from buyers unless a sale agreement has been executed. The moves are expected to put an end to pre-launch bookings and publicity which jacks up property prices beyond prevailing market rates. This speculation severely disadvantages genuine buyers while aiding those out to make a quick buck.

The Bill also seeks to check diversion of funds by providing that funds received by way of advances or payments from buyers in a particular project are deposited in an earmarked bank account. This, along with the proposal to prohibit mortgage of land, is aimed at checking diversion of funds and fraud.

There have been several instances of builders using deposits and payments for purposes other than construction of the promised project in addition to selling the same scheme to multiple buyers.

Move: Builders can’t ask for an advance for an apartment without signing a sale agreement

Impact: Will put an end to pre-launch bookings

Move: Developers may have to maintain separate bank accounts for payments from each project. Can’t mortgage land for which agreement with buyers signed

Impact: Check fraud and diversion of funds to other projects
Move: Fittings and specifications of house handed over to buyers have to be as per ads

Impact:
Ensure buyers aren’t short-changed
Penalty: Up to 3-year jail term or fine up to Rs 1 lakh, or both

Paper work always are presentable but it comes in presence often only and that too in a manipulated manner...

I just pray the bill is implemented as it states... I got the above section facts from sunday 5th Nov main page article of times of india paper... just for reference
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