What is a legal check when you take a home?

So you have finally read through the brochures and dived through furniture catalogue. You might already be brimming with ideas for interior décor. However, there remains one important caveat before you can finally buy your dream home: it has to be legally clear. Ensuring a property is legal to buy and possess is obviously an important prerequisite; unfortunately, not enough of us really give it a thought until absolutely necessary. Left on its own, legal issues have the peculiar tendency to stay undiscovered until the very end where you have to pay inordinate amounts of money to get rid of what could have been fairly simple issues. Some preliminary checks and a little responsibility can go a long way in ensuring that your dream home safely finds itself in your possession with little to no additional hassles.

Legal check

CONFIRM CLEAR TITLES

A title is the conclusive legal document about the ownership of any property. With real estate as well, you need to see if the title is under dispute; if so, it might be a good choice to look elsewhere for a home. Court cases of real estate can stretch on for years, especially if documents are missing (which they often are). Hire a property lawyer or similar legal consultant to see if the title is clear or not. This will save you a lot of hassle (and tears) in the long run.

CHECK FOR APPROVAL FROM BANKS AND FINANCIAL INSTITUTIONS

This is one way you can get someone else to do the heavy lifting for you. Apply for a loan to buy a property and if approved, it means that the bank or any other financial institution has done the due diligence on the legality of the property. If they refuse you a loan, it might signify that there might be some issues with the property. Banks will often perform their own legal checks and verifications and it is fair to admit that with their resources, which are better than yours.They might be able to conduct more thorough investigations than any individual could afford to. Therefore, if a bank or a financial institution is willing to finance your purchase, it can help you validate the legality of the property. This is not watertight, though, and you should always conduct your own independent verifications.

CHECK FOR OUTSTANDING LEGAL DUES OR MORTGAGES ON THE PROPERTY

A document called an encumbrance certificate testifies that a property is free of any legal liabilities or dues payable. This means that there are no outstanding or unpaid mortgages on the property. If you can get this document, it means that you can go ahead and buy it with peace of mind. Many shifty realtors or owners might sell you a property with outstanding dues to make a quick buck off you; beware of this all too common trick. Otherwise, you might find yourself having to move out of your new home for not paying on a loan that the previous owner took on the property and transferred the liability on you when selling you his property. Yes, it is that complicated.

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