As an NRI (Non-Resident Indian), selling a property in India can be a daunting task. While the process itself can be complicated and time-consuming, the risk of falling victim to property scams only adds to the stress. In this article, we’ll take a closer look at one of the most common property scams in India and offer tips on how to protect yourself.
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The Scam
The scam in question involves brokers who approach property sellers with an offer that seems too good to be true. These brokers may even offer a slightly higher price than what the seller is asking for, and ask them to sign a Memorandum of Understanding (MoU) or a written agreement. This document is not a registered agreement and gives the broker a time frame of 30 to 60 days to find a buyer.
During this time, the broker will attempt to find another buyer who is willing to pay a higher price for the property, pocketing the difference as profit. However, in many cases, the broker is unable to find another buyer, leaving the seller in a state of limbo. The seller may feel ethically bound by the agreement, but the legality of the document is not binding, which can cause undue stress and chaos.
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How to Avoid the Scam
The best way to avoid this scam is to be vigilant and cautious when dealing with brokers. When approached by a potential buyer, always ask whether they are a buyer or an agent representing someone else. If they claim to be a buyer, check their background, including their social media presence and profession, if possible.
If you decide to sign an MoU, make sure to only wait for a maximum of 10-15 days, and clearly state that you will only go ahead with a registered agreement. This will require the buyer to pay stamp duty, which can be a significant amount (6-7% of the property value). Brokers looking for a quick profit are unlikely to go through with a registered agreement, so this is a good way to weed out genuine buyers from scammers.
Conclusion
Selling a property in India as an NRI can be a complicated process, but it’s important to be vigilant and protect yourself from property scams. By being cautious when dealing with brokers, checking their backgrounds, and insisting on a registered agreement, you can avoid falling victim to this common scam. Don’t let the fear of scams stop you from selling your property – with the right precautions, you can sell your property in India safely and efficiently.