Will you get refund of flat booking amount after cancelling it? Check your state's RERA Act which will decide the extent of recovery
home/flat/apartment/bungalow, etc you have to pay a booking amount before finalising the deal. It is intended to put some cost to cancellation of the deal because backing out creates problems for the builder and the home buyer. For the builder, it means he/she has to spend resources again to find a new buyer. For the home buyer, it means he/she may lose out on the booking amount which was initially given to the builder for booking the said home. So, what happens if a buyer has to cancel the booking due to an unavoidable reason?
As per an ET Wealth Online report last week, a similar incident happened when a home buyer backed out of the purchase deal, and the builder forfeited the entire Rs 5 lakh that was given as a booking amount. Read more about how MahaRERA rescued this buyer.
Some states have not even specified how much a builder can forfeit if a buyer cancels a deal
Although some states and union territories are proactive in developing RERA legislation regarding forfeiture rules when the buyer cancels a flat booking, experts say some states have failed to do so to date.
«The Real Estate (Regulation and Development) Act, 2016 (RERA) plays a quintessential role in safeguarding the interests vis-à-vis rights of the homebuyer in India. However, it is crucial for us to point out that there are few states/Union Territories which still do not specify the cancellation/withdrawal charges through appropriate legislative framework which can be imposed by the promoter on the prospective allottee when the latter cancels
