Stuck in a Delayed Real Estate Project? Here Are Some Actions You Can Take

It's every homebuyer's worst nightmare to face the long halt delay in possession of their dream house. Because of this, the homebuyer suffers not only economically but also mentally. Therefore, in this blog, PropertyAngel will discuss what you as a homebuyer can do if your real estate project is delayed.

Firstly, it's important to understand the reasons behind delayed projects. The most common reasons include poor project management, lack of funds, delays in obtaining permits and approvals, and legal disputes. Regardless of the reason, homebuyers have the right to take legal action to protect their interests.

The Legal Route: RERA, NCLT, and CPA

The Real Estate Regulation and Development Act (RERA), passed in 2016, protects homebuyers in case of delayed projects. RERA aims to regulate the real estate sector and ensure timely completion of projects, and it applies to all states and union territories in India. It mentions a few of the most important roles of a real estate regulator, which are: 

• Registering and regulating agents and real estate projects.

• To create and maintain a public records website for all real estate projects for which registration has been granted, including information submitted in the application. 

• To maintain a public database on its website with the photographs and names of promoters who are defaulters, as well as project details, whose registration has been penalised or withdrawn under the Act, and the reasons. 

• To post the photographs and names of real estate agents who are registered and have applied under this Act, including those whose registration has been cancelled or rejected, on its website for public access.

• Establish laws for each region under its jurisdiction, including the fees charged to real estate agents, allottees, and promoters. 

• To ensure that allottees, promoters, and real estate brokers fulfil their obligations under this Act and its rules and regulations. 

• Ensure compliance with its regulations, orders, or instructions issued under this Act.

• To carry out any additional tasks delegated to the Authority by the government in order to carry out this Act.  

NCLT

Also, homebuyers can file a complaint with the National Company Law Tribunal (NCLT). The NCLT has the power to appoint an administrator to take control of the project and ensure its timely completion. Additionally, the NCLT can order the developer to compensate the homebuyers for the delay.

CPA

Apart from RERA and NCLT, homebuyers can take legal action under the Consumer Protection Act (CPA) as well. The CPA gives consumers the right to seek compensation for any deficiency in services or goods. If a developer fails to deliver a home within the promised time frame, homebuyers can file a complaint with the appropriate consumer court.   

Should You Sell the Property?

This is the first question that comes to mind for a homebuyer who is stuck in a delayed project. Because you're mentally and financially stressed due to such a big delay, the best option may be to sell the property. But it isn't as easy as it looks.

• Due to such a delay, the value of the property is often adversely affected.

• Delayed projects have unfinished development within a big housing complex.

• There is no guarantee when the delayed projects will be completed.

• In most delayed projects, the basic infrastructure and construction may be incomplete.

All these factors make finding a new buyer nearly impossible, as no one would be willing to purchase a real estate property with so many issues and problems. 

Should You Continue To Pay for EMIs?

This is a common question, as you might be confused about whether you should continue paying your EMIs for the home loan or stop. There is also concern that if you stop paying your home loan EMIs, your credit score will suffer, and your financial credibility in the market will suffer. 

However, according to some experts, homebuyers shouldn't stop paying their EMIs even if the project is delayed. The main reason for this is that financial institutions from which homebuyers may have availed their home loan may drag them to court and, in addition, charge homebuyers interest on the EMI amounts deferred by them.  

Final Words

If you're stuck in a delayed project, your first option is to go the legal route and file a consumer complaint under RERA, NCLT, or CPA. 
If you're considering selling your house, it will be tough for unfavourable reasons. 
According to some experts, as a homebuyer, you shouldn't stop paying your EMIs.   

About PropertyAngel

PropertyAngel is a leading O2O (online-to-offline) second landlord platform. We are a Bangalore-based property management company offering professional property management for individual apartments, houses, and villas. Contact us at (91-80-47095974) or (91-7406484455) if you need guidance on how to invest in the right property in Bangalore.

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