RERA: Builders liability Defined
The Union government notified rules to implement the Real Estate Regulation Act (RERA), which will enable buyers who have invested in real estate pro¬jects - including existing ones - to secure interest at 10.9% per annum for delayed possession.
In case a buyer is seeking a refund, they will now be entitled to a refund on the entire payment at the same rate, and the builder will have to repay the amount within 45 days of a claim be¬ing made. The interest rate has been fixed at 2 percentage points above the SBI's marginal cost of funds (the current benchmark lending rate for banks).
Now that the rules have been noti¬fied, every builder will have to register with the State regulator. The final rules specify that developers of ongoing projects will also have to deposit 70% of the funds collected, but which have remained unused, into a separate bank account within three months of app)ying for registration.
This is a major change from the draft rules, where this provision was absent, and is aimed at providing security to buyers and ensuring that construction is completed without the builder transferring the funds to another project. To address the problems being faced by buyers, some of whom have been waiting for their homes for up to 10 years, the rules also stipulate that the developers of ongoing projects specify the scheduled comple¬tion date while registering the project with the regulator.
The rules spell trouble for developers who have diverted funds collected from buyers, because, under the new law, the regulator would be obliged to issue judgments within 60 days of complaints being filed.
The rules also make it man for a buyer to pay the interest, same rate of 10.9% on the dues by developers. This will come as a relief for buyers who have to -cu shell out upwards of 15% inter delayed payments.
The rule will be applicable Andaman and Nicobar Islands, garh, Dadra and Nagar Haveli, and Diu, and Lakshadweep, an release said. In a statement, the urban development ministry sai working on similar rules for Delh rules, it is learnt, will be noti November.
With the Centre notifying the states and UTs are expected to foil soon. As per the provisions of the 2016, the regulatory authorities h be put in place by April 30, 20 day before the full Act is brought effect. Chandigarh has set up a tempi regulatory authority, which makesI of the first in Indi4eto do so.
The Union government notified rules to implement the Real Estate Regulation Act (RERA), which will enable buyers who have invested in real estate pro¬jects - including existing ones - to secure interest at 10.9% per annum for delayed possession.
In case a buyer is seeking a refund, they will now be entitled to a refund on the entire payment at the same rate, and the builder will have to repay the amount within 45 days of a claim be¬ing made. The interest rate has been fixed at 2 percentage points above the SBI's marginal cost of funds (the current benchmark lending rate for banks).
Now that the rules have been noti¬fied, every builder will have to register with the State regulator. The final rules specify that developers of ongoing projects will also have to deposit 70% of the funds collected, but which have remained unused, into a separate bank account within three months of app)ying for registration.
This is a major change from the draft rules, where this provision was absent, and is aimed at providing security to buyers and ensuring that construction is completed without the builder transferring the funds to another project. To address the problems being faced by buyers, some of whom have been waiting for their homes for up to 10 years, the rules also stipulate that the developers of ongoing projects specify the scheduled comple¬tion date while registering the project with the regulator.
The rules spell trouble for developers who have diverted funds collected from buyers, because, under the new law, the regulator would be obliged to issue judgments within 60 days of complaints being filed.
The rules also make it man for a buyer to pay the interest, same rate of 10.9% on the dues by developers. This will come as a relief for buyers who have to -cu shell out upwards of 15% inter delayed payments.
The rule will be applicable Andaman and Nicobar Islands, garh, Dadra and Nagar Haveli, and Diu, and Lakshadweep, an release said. In a statement, the urban development ministry sai working on similar rules for Delh rules, it is learnt, will be noti November.
With the Centre notifying the states and UTs are expected to foil soon. As per the provisions of the 2016, the regulatory authorities h be put in place by April 30, 20 day before the full Act is brought effect. Chandigarh has set up a tempi regulatory authority, which makesI of the first in Indi4eto do so.
