It is important to take precautions when buying any property, especially in the resale market because many times such properties are mired in legal tussles. One such aspect is when buying an inherited property because one has to be doubly sure how the property devolved upon the seller/s and if it reeks of fraud.

Here is a list of eight safeguards one must take while buying an inherited property.

VERIFY THE ORIGINAL OWNER'S DETAILS

The person from whom the property has devolved to the current owner needs thorough scrutiny. "One should confirm the ownership of the original owner by verifying the original title documents from the sub-registrar office and other antecedent documents through which the person acquired the property," says Niraj Kumar, partner, DSK Legal. This includes a diligent and proper encumbrance search for a period of 30 years to be conducted at the office of the sub-registrar/revenue authority concerned. Checking for mutation and payment of property taxes in the name of the owner and which is duly paid needs to be confirmed too. Kumar adds that if the property is flowing through succession, the death certificate and legal heir certificate of the original owner issued by the competent authority should also be verified.

CHECK THE VERACITY OF THE SUCCESSION DOCUMENTS

Along with this, the buyer should be aware of counterfeit documents such as a succession certificate. "You can check the authenticity of the documents and retain the original ones, if possible," says real estate expert, Nitin Bhatia. Once the buyer is assured that the correct process is being followed, he can capture all these details in his sale deed, he adds.

CHECK THE DETAILS OF INHERITANCE WHEN BUYING INHERITED PROPERTY

The buyer should first check the inheritance process, i.e., how the property devolved upon the seller/s. "Ensure that the seller has the legal right to sell their property and there are no other legal heirs who may have a claim on the property. If the seller has got property by way of a will, ensure that the will is genuine," says former judge and Supreme Court lawyer, Bharat Chugh. He adds that due diligence should be done to see if there is a challenge to the will, and any competing wills, as in many cases legal heirs rely on multiple competing wills to lay their claim on the property.

THE INDEMNITY CLAUSE SHOULD BE INSERTED

A buyer can also include an indemnity clause in the sale deed to further safeguard his financial interests. "The crux of this clause should be that in the case of any future dispute on inherited property, the seller will indemnify the buyer," says Bhatia. "The terms and conditions of this clause can be mutually decided upon between the buyer and the seller," says Kumar. Bhatia adds that in case of any doubt or high perceived risk, one can also execute a separate indemnity bond in court. The main point of this clause should be that the seller would defend the buyer if there is a dispute regarding the inherited property.

MAKE ALL LEGAL HEIRS EITHER PARTY OR WITNESSES

For more safety, all interested parties in the transaction should be made a party to the case. "All the legal heirs of the original owner having any semblance of interest in the property should be a party to the proposed sale transaction," says Kumar. Legal heir certificates/survivorship certificates should be insisted upon to ensure that there are no other legal heirs entitled to inherit the property.

A buyer should also insist on including all the legal heirs as confirming witnesses. "It is important to make the sale deed secure. If all the legal heirs become witnesses to the transaction, none of them can stake any claim on the property at any stage in the future," says Bhatia. Although this can be an operational issue bringing all the stakeholders together, this issue can be clarified before closing the deal. "If the seller is hesitant and is not able to share any logical reason then there is every reason to doubt the intentions of the seller/s," warns Bhatia.

PAY BARE MINIMUM TOKEN MONEY

Often sellers insist on a high percentage of token money to seal the deal. Any buyer should pay a bare minimum token money in any property transaction. Reasoning this, Chugh adds that a buyer's money shouldn't get stuck if he is not satisfied with the title of the inherited property. "If the seller insists on a lump sum token money then it is the first red flag for the buyer," says Bhatia. Moreover, in case of a dispute, a seller will always be in a tearing hurry to sell the property.

BE CAUTIOUS WHEN PAYING TO MULTIPLE SELLERS

One also has to keep in mind that it is not necessary that all the sellers have an equal stake in the property. Hence, one should only pay in the proportion of the ownership. "In case, one is buying property from multiple sellers i.e. two or more sellers based on succession certificate or probate, it is not necessary that all the sellers will have an equal stake in the property. To keep disputes at bay, one should only pay in the proportion of ownership as per succession certificate or probate," warns Bhatia.

CHECK FOR ANY IMPENDING COURT CASES ON PROPERTY

One should also check for impending court cases on the property, especially from unexpected quarters. It is not always that only legal heirs would fight among themselves to lay claim on the property. It is very much possible that they may gang up and try to brush another issue under the carpet. "There was a case where the deceased owner had taken a loan against the property from one of his friends. After he died, there was no dispute among legal heirs but they refused to clear the loan. The friend of the deceased filed a court case to recover his dues from the sale proceeds of the property. In such cases, a buyer can hire a lawyer to check whether there is pending litigation against the property or not," says Bhatia.