The short answer
Between choosing a home and owning it, the order matters as much as the checks. Get your loan sanction and budget first; inspect the property physically; collect the documents and have a lawyer trace the title and check approvals; pay only a small token with written refund terms; sign the agreement to sell; arrange the society NOC and loan disbursal; register the sale deed and pay the stamp duty; then apply for mutation and transfer the utilities.
Each step below says what to do, what can go wrong and what to keep. The companion checklist lets you tick them off on site.
Step 1: budget and loan sanction
Work out the full cost, not the price: stamp duty and registration at your state's rate on the higher of the price and the guidance value, any society transfer charges, brokerage if any, the lawyer's fee, loan processing charges, and moving and furnishing. The property purchase cost calculator adds these up.
Get an in-principle sanction from your lender before you commit. The lender will also look at the property's papers, which is a second opinion on the title worth having.
Step 2: physical checks
Visit at least twice, once on a weekday evening. Check water supply hours with residents, power backup coverage, the parking space you are being sold and whether it is allotted in writing, seepage under windows and below bathrooms, cracks, lift condition, and fire safety equipment and exits.
Measure the carpet area and compare it with what is in the documents. Walk the building with the sanctioned plan if you have it: extra floors, enclosed balconies and changed layouts are common, and the buyer inherits them.
Talk to two or three residents and, in a society, the secretary. Ask about water, maintenance arrears, any special levy that has been resolved but not yet billed, pending repairs to the structure or the lift, and whether redevelopment has been discussed. A society's minutes book often says more about a building than its brochure ever did.
Step 3: collect the documents
Ask for: the seller's sale deed and the earlier deeds in the chain; an encumbrance certificate; the latest property tax receipt; electricity and water bills; for a society flat, the share certificate and the society's no-dues and no-objection letters; the sanctioned plan and occupancy or completion certificate; for a new project, the RERA registration and the draft agreement for sale; and, if the property is mortgaged, the loan statement and the lender's letter.
Copies first. Originals are inspected by your lawyer and your lender before the main payment.
If the seller inherited the property, ask also for the death certificate of the previous owner, the will and its probate where your state requires probate, or a succession certificate or a registered relinquishment by the other heirs. If any part of the price is going to a person other than the owner on the deed, ask why before going further.
Step 4: title search and encumbrance certificate
Your lawyer traces ownership through registered deeds, commonly for about 30 years, and checks the encumbrance certificate from the sub-registrar for registered mortgages and transactions over the period. The names should match across the deed, the tax records and the seller's identity documents, and every co-owner must join the sale.
Watch for sales by power of attorney, missing links in the chain, inherited property without all heirs' consent, and mortgages the seller did not mention. The encumbrance certificate shows only registered transactions, so it complements the title search rather than replacing it.
Step 5: approvals, RERA and dues
Confirm the occupancy certificate exists for the building and the land use permits residential use. For a new project, enter the RERA number on the state RERA portal yourself and read the committed completion date, the approvals uploaded and any complaints. Under section 13 of the RERA Act, a promoter cannot take more than ten percent of the cost as an advance before a registered agreement for sale.
Confirm property tax and society dues are paid up to date. Dues attach to the property, not to the seller.
Step 6: a small token, with terms in writing
Pay a token only after the copies look clean, and only by bank. The receipt should state the total price, the deadline for the agreement to sell, the documents the seller will provide, and when the token is refunded in full, such as if the title shows an undisclosed problem. The token receipt format sets this out.
Keep the token small enough that you could afford to lose it in a dispute, and short in time: a deadline of a couple of weeks for the agreement keeps both sides moving and stops the property being held while the seller looks for a better offer. Add a line that the seller will not accept another token for the property until the deadline.
Step 7: agreement to sell, NOC and loan disbursal
The agreement to sell fixes the price, the payment schedule tied to the seller's obligations, the seller's promises about title and dues, and the deadline for the sale deed. It does not transfer ownership; under section 54 of the Transfer of Property Act, 1882, a contract for sale does not by itself create any interest in the property. Check your state's stamp duty on the agreement, and whether it must be registered.
The seller obtains the society's no-objection and no-dues certificates, and closes any existing loan by direct payment to the lender, receiving the originals. Your lender completes its legal and technical checks and prepares to disburse at registration.
Step 8: sale deed, stamp duty and registration
The sale deed is executed and registered at the sub-registrar's office, with stamp duty and the registration fee paid, both parties present with identity documents, and two witnesses. Above a value threshold, the buyer must deduct tax at source from the price and deposit it; see the TDS guide.
Worked example (illustrative figures only): a flat agreed at ₹75,00,000 where the guidance value is ₹70,00,000 attracts duty on ₹75,00,000, the higher figure. At an assumed 6% duty and 1% registration fee, that is ₹4,50,000 + ₹75,000 = ₹5,25,000. Your state's actual rates, and any concessions such as for women buyers where offered, are on the stamp duty page.
Step 9: after registration
Apply for mutation so the municipal and, where relevant, revenue records show you as owner; registration alone does not change them. Transfer the electricity and water connections, apply for society membership, and keep the registered deed, receipts and the whole document file together.
Documents to keep permanently: the registered sale deed and every earlier deed you received; the encumbrance certificate; the agreement to sell and token receipt; payment proofs for every instalment; the TDS challan and certificate if you deducted tax; the society NOC, no-dues certificate and your share certificate; the occupancy certificate copy; the mutation order; and the loan sanction and disbursement letters. You will need most of them again when you sell.
Common mistakes across the process: paying a large token before the title search; paying in cash; signing an agreement without a refund clause; forgetting the guidance value when budgeting duty; skipping mutation.
Questions to ask at each step: Is this the latest deed, and where are the earlier ones? Is there any loan on the property? Is there an occupancy certificate? What exactly does the price include? Who pays the stamp duty and transfer charges? What happens to my money if the title fails?
Common questions
When should I pay the token amount?
After you have seen copies of the title documents and they look clean, and only with a receipt that states the price, the deadline for the agreement and a full refund if the title shows an undisclosed problem.
Does the agreement to sell make me the owner?
No. Ownership passes when the sale deed is registered. A contract for sale does not by itself create an interest in the property under section 54 of the Transfer of Property Act, 1882.
How far back should the title be checked?
Lawyers and lenders commonly trace title for about 30 years. Your lender may set its own requirement.
Is stamp duty charged on the price or the guidance value?
Generally on the higher of the two. Check your state's rules on the stamp duty page.
What is mutation and do I need it?
Mutation updates the municipal or revenue records to your name after registration. You need it to pay property tax in your name and for a smooth resale later.
What if the seller still has a home loan on the property?
That is common and manageable. The agreement should say that part of your payment goes directly to the seller's lender to close the loan, and that the seller hands over the lender's closure letter and the original documents before or at registration. Your own lender will usually arrange this directly.
Sources
- Transfer of Property Act, 1882, section 54
- Registration Act, 1908, section 17
- Real Estate (Regulation and Development) Act, 2016, section 13
- Your state's stamp act and registration rules
Last checked 2026-10-02.