Loan against Lal Dora Properties in Delhi-NCR

What is Lal Dora Property?

The term “Lal Dora” was coined first time in year 1908. It is actually a category of land which is a part of village known as ‘Abadi Area’ or Habitation.  In the late 19th century and early 20th century when freedom movement of India was on peak point then these areas were emerging. These areas of land were being used for non agricultural purposes only. It was an extension of habitation where villages used to keep their livestock like Animals, farm products or events of festival etc.

Why these are exempted from MCD or Urban Development department laws?

In those days these land areas were marked by tagging a red thread (Lal Dora) by the land revenue department. The red thread was used to mark a boundary and distinguish it from agricultural land. Thus the  land became famous as Lal Dora Land or Lal Dora Property.  As these land do not fall in the jurisdiction of Municipal Corporation of Delhi (MCD) or the Urban Development Department so they are exempted from their by-laws also. These are also known as unauthorized colonies.

In 1957, MCD issued a notification about it. These land areas were listed by the government in the outskirts or MCD and within both.  In 1963, MCD passed a notification which relaxed the strict norms over urban or rual lal dora properties. Sanction of building plan was no longer mandatory.

What are the areas of Lal Dora?

Villages like Burari, Sant Nagar, Chhatarpur, Mahipalpur, Munirka, Lado Sarai, Basant Gaon, Mehrauli and similar more than 1000 areas are all under Lal Dora and Lal Dora extension. With growing days, many of them have become commercial and industrial hub. Some of them are posh colony and elite areas. Delhi master plan 2021 has included some of them to develop as premium residential and commercial zone.

How to get loan on Lal Dora properties

Now you know that these properties are not governed by MCD or Urban development. There is no stamp duty paid on the sale-purchase. No registry of property is held. Only General Power of Attorney (GPA) is done. A notarized GPA is maintained during sale or purchase which has no legal powers of sale-purchase. Some of the property dealers suggest “Registration of Will” to be more secure of your property. But these all do not solve your problem.

Loan can not be sanctioned to you on the basis of GPA or Will. Here, you have to arrange some registry agent or property consultant. He shall make it registered from court paying stamp duty as per circle rate of property under Lal Dora Act.

Loan from NBFCs or Coperative Banks or Private Lenders

Once your property is registers in the office of tehsildar or land revenue registrar you first step is done. Now you have to approach the loan lenders. Public sectors banks will not provide you the Home Loan or Loan Against Property even after registry. NBFC like DHFL or Indiabulls  will consider your loan requirement. Some Co-operative banks like Kangra Co-operative Bank also deal with these loan against property or home loan.

You have to apply as the procedure laid down by the lender and loan will be sanctioned to you in a period of 10-15 days.

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