A No Objection Certificate (NOC) or letter of no objection (LNO) is a statement of permission granted to a person or a company to go ahead with the construction or buying of a property. NOC is must have a document without which the concerned property is bound by legal hardships.
The No Objection Certificate (NOC) must be availed by as many as 19 departments in a few Indian states. Assume you do not have a NOC from the Electricity department of your applicable state, you are not authorised to receive electricity to your property at all.
This No Objection Certificate from a few departments is based on location and use while a few NOC’s are absolutely necessary. For example, if your property is near a Railway station or an Airport, it will present you with a possibility to avail a NOC from the respective departments.
A No Objection Certificate from Electricity, Water, and fire departments are the most basic and necessary certificates in addition to the NOC from the society and the local authority. You also have to get this certificate from the real estate builder if you’re buying a property/ flat in an apartment.
If a property has an escalator, a No Objection Certificate must be availed for the same too. By now, it may be clear that a NOC is issued by the government in the best interests of the society. The document is proof that your property is safe from expectable or natural hazards.
NOC For Bank Loan / Mortgage
A No Objection Certificate must be availed from the bank or a financial institute in the following matters:
- Closure of a loan
- Loan transfer from one bank to another
- Transfer or sale of the mortgaged property
- When you may need to transfer the mortgage to a different person or add a co-applicant to the lease.
NOC From A Builder
When buying a property/ flat or an apartment, a NOC from the developer is required in some but all Indian states. Most of the apartments have a cooperative society to ensure smooth and hassle-free living.
The property buyer must ensure the NOC issued to him by the developer is legitimately acceptable with the following checklist:
- Name & Address:
Small real estate builders are known to play it safe by issuing a white label certificate which can be issued to each buyer. Holding a personalized No Objection Certificate with the name and address assures the best concerns of the buyer.
- The authenticity of the NOC:
A few builders are recognised to issue the NOC in a white paper or have them signed by a front desk official. Monitoring for the authenticity of the NOC is as necessary as the NOC itself.
- Nature of transaction:
Some transactions become complex when there is a property owner’s share included. It is advisable for the property buyer to understand the terms and conditions of the sale before making any property purchase decision.
- Payment Details:
A NOC must expressly have details regarding the amount due to the seller. It should also have details concerning VAT, Service tax and the transfer fees. This will clear the utmost doubts and disputes should there be any in the future.
Buying a property will continuously remain an exciting time considering the many emotions involved. Being aware of the technical and legal process and seeking expert advice when needed sure saves time, money and regret.