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RERA will Help You in Buying Your Dream Home – FAQs

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rera faqs

RERA Act became effective from May 1, 2017 after a long and tiring struggle. Everywhere people are talking about this Act and how is it going to benefit? RERA does bring a bunch of advantages for home loan borrowers and here are some of them with most frequently asked questions.

Frequently Asked Questions (FAQs) on RERA Act

What is RERA?

Real Estate (Regulation and Development) Act, 2016 became effective from May 1, 2017. The Act has brought in transparency in the real-estate sector after which the builders will have to complete the project within the deadline.

Who can be benefited with RERA?

After the implementation of this Act, builders will have to complete the project on time or have to pay the concession. The customers can now be confident about the date of possession and accordingly apply for loans without any hassle.

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What was the need for setting RERA Act?

In order to maintain transparency between the real estate developers and the consumers, RERA Act came into existence. With the implementation of this Act, consumers will get the timely and satisfactory completion of projects. The real estate sector has grown in the recent years but has largely been unregulated from the perspective of consumer protection. Though, consumer protection laws are available, the recourse available therein are only curative, but not preventive. This has affected the overall potential growth of the sector due to absence of professionalism and standardization.

In which states is RERA implemented?

As on July 31, 2017, RERA is applicable in 15 states namely Andhra Pradesh, Bihar, Chhatisgarh, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, Uttarakhand, Arunachal Pradesh, Assam, Himachal Pradesh, Jharkhand, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Telangana, Tripura, West Bengal, Goa. Except for the State of Jammu and Kashmir, all 7 UT’s have notified.

What is the time limit for grant of registration by RERA?

The registration shall be granted within the 30 days from the day of application. Post the registration, RERA would also provide the registration number, Login ID and password. With the help of these details, you can access the website of Authority and to create his/her webpage and fill in the details of the proposed project.

What are the key terms that have been defined in the Act?

Some of the key terms defined in this Act are as follows:

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Advertisement , Agreement for Sale, Allottee, Apartment, Architect, Building, Carpet Area, Commencement Certificate, Common Areas, Completion Certificate, Development, Development Works, Engineer, Estimated Cost of Real Estate Project, External Development Works, Family, Garage, Immovable Property, Interest, Internal Development Works, Local Authority, Occupancy Certificate, Person, Planning area, Project, Promoter, Prospectus, Real Estate Agent, Real Estate Project, Sanctioned Plan

What are the objectives and reasons for which the Act has been framed?

The Real Estate Act is intended to achieve the following objectives –

a) Ensure accountability towards allottees and protect their interest.
b) Infuse transparency, ensure fair-play and reduce frauds & delays.
c) Introduce professionalism and pan India standardization.
d) Establish symmetry of information between the promoter and allottee.
e) Imposing certain responsibilities on both promoter and allottees.
f) Establish regulatory oversight mechanism to enforce contracts.
g) Establish fast- track dispute resolution mechanism.
h) Promote good governance in the sector which in turn would create investor confidence.

Does the Act cover both residential and commercial real estate?

Yes, RERA Act covers both residential and commercial real estate.

Does the Act cover ongoing / incomplete projects?

Yes, both ongoing/incomplete project and a future project are covered under the Act.

Does the Act cover all projects in urban areas and in rural areas?

Does the Act cover all projects in urban areas and in rural areas?

What if the possession is delayed?

The delayed possession is no longer the problem of the property owners. Post the implementation of RERA, builders are mandated to complete the project within the time as committed else they have to pay an interest rate of 2 percentage points above State Bank of India’s lending rate. So, it is a win-win situation for home buyers. Isn’t it great?

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What about the land purchase loans?

RERA will change the functioning of Indian real estate for sure. Unlike the past, lenders now may trust developers as well as home loan borrowers that the possession date is fixed. With proper legal documentation of the property, the lenders will obviously find it less reluctant to provide loans. Thus, if you have been finding it difficult to get a loan for land purchase, RERA Act has definitely a good news for you.

What is the best thing about RERA Act?

From now onwards, one property will be sold to a single person only. Home loan rates are now as low as 8.35% per annum across top banks. With RERA coming in, borrowers have got the official right to take charge of their property in the form of documents.

As you can see that RERA would bring transparency in the real estate deals which will definitely help you buy your dream home without any hassle. So, smile now because now is the time for you to enjoy this privilege given to you by the government.

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