I am selling my flat and buyer is taking a loan from bank. I want complete payment from the buyer before sale deed registration. Can I do so?

If the buyer is self-financing (without a home loan) you may demand the complete payment before sale deed registration

But in your case, the buyer is taking a home loan and you may need to follow the below standard procedure:

• Check the sanctioned loan amount with the bank.
• Collect the down payment from buyer, usually the down payment is the difference between the consideration amount and sanctioned loan amount

For example, the sanctioned loan amount is 80% of the consideration amount, and you can collect 20% as a down payment from the buyer before registration of the sale deed.

• The consideration amount is Rs. 1 Cr
• The sanctioned loan amount is Rs. 80 Lakhs
• Down payment is Rs. 20 lakhs

Usually, the down payment is collected when signing the Sale Agreement with the buyer. A Sale Agreement is mandatory for the buyer to process his home loan application.

• Seller and buyer register the Sale Deed in the sub-registrar office
• Buyer and Bank register the MODT in the sub-registrar office (loan registration)

(Typically, the Sale Deed and MODT registration are back-to-back processes at the same time in sub-registrar office)

• The seller should hand over all the property documents to bank including the sale deed which you recently registered with buyer
• The bank will handover the final settlement cheque/DD to seller

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To answer your question, the bank will handover the final settlement after the Sale Deed and MODT Registration.

However, you can deliver the property possession to buyer after the remittance of complete payment to your bank account.

Also, most of my clients add a clause in Sale Deed that “Deed becomes invalid if the complete consideration amount is not remitted to seller’s bank account”. As this clause may support legal stance for seller

You must review your Sale Deed draft carefully, We have been guiding our client in Sale Agreement & Sale Deed review and assisting the entire process of Sale. To consult, please WhatsApp to +91-97424-79020

Thank you for reading…