Can a property still be risky even if I'm taking a loan from the bank?
Yes, a property can still be risky even if you’re taking a loan from a bank, and this is one of the biggest misconceptions among buyers. Many people assume that if a bank approves a home loan, it means the property is 100% safe and legally clear. However, in reality, banks primarily evaluate the borrower’s repayment ability and conduct only a limited legal check of the property. That means a loan approval is not a full legal guarantee—it simply indicates that the property meets the bank’s minimum requirements for lending.
While banks do check documents such as the title deed, sale agreement, and encumbrance certificate, they may not verify every critical aspect of ownership history, zoning rules, or pending litigation.
That’s why having a key legal checklist for buying a property is extremely important, even when purchasing through a bank loan. You should independently verify the title chain, ensure the encumbrance certificate is clean, confirm all building approvals and RERA registration, and check for pending dues or court cases. A professional property lawyer can help conduct this checklist for the property purchase legal check, ensuring that every document is reviewed beyond what the bank covers.
