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Letter of Allotment: A Guide for Property Buyers

Updated on : 02 April 2025

By Hexadecimal Software Team

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1. Introduction to Letter of Allotment
2. What is a Letter of Allotment?
3. Importance of a Letter of Allotment
4. Key Components of a Letter of Allotment
5. How To Write an Application for Land Allotment Letter
6. How to Obtain a Letter of Allotment?
7. Legal Aspects and Validity
8. Difference Between Allotment Letter and Sale Deed
9. Common Mistakes to Avoid
10. What to Do If You Lose Your Letter of Allotment?
11. FAQs

1. Introduction to Letter of Allotment
2. What is a Letter of Allotment?
3. Importance of a Letter of Allotment
4. Key Components of a Letter of Allotment
5. How To Write an Application for Land Allotment Letter
6. How to Obtain a Letter of Allotment?
7. Legal Aspects and Validity
8. Difference Between Allotment Letter and Sale Deed
9. Common Mistakes to Avoid
10. What to Do If You Lose Your Letter of Allotment?
11. FAQs

Introduction to Letter of Allotment

A letter of allotment is a key document in real estate, confirming that a property has been allocated to a buyer. Issued by a developer or authority, it includes details like property specifics, payment terms, and conditions. It serves as initial proof of ownership before legal transfer through a sale deed.

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What is a Letter of Allotment?

In a country like India, an allotment letter is an essential document to purchase a property. Right after booking the house is received by the buyer, the builder issues an allotment letter.

The first owner issues this document to the owner. Then the other owners can get a copy of the letter from the owner/seller.

The following information is included in the allotment letter:

Detail	Description
Construction Terms	Rules for property construction.
Payment	Installments and due dates.
Construction Schedule	Timeline of the project.
Amenities	Basic facilities provided.
Total Amount	Final cost to be paid.
Delivery Date	Handover timeline.
Delay Liability	Compensation for delays.

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Importance of a Letter of Allotment

✅ Proof of Property Allocation – Confirms the buyer's right before the sale deed.
💰 Financial Clarity – Clearly states payment terms and total cost.
🏗️ Construction Timeline – Provides a structured schedule for completion.
🏢 Amenities Assurance – Lists essential facilities promised by the builder.
📜 Legal Protection – Acts as proof for disputes or claims.
🏦 Loan Approval – Essential for securing home loans.

Key Components of a Letter of Allotment

Component	Description
Property Details	Includes property type, size, and location.
Buyer & Seller Info	Names, addresses, and contact details of both parties.
Payment Terms	Breakdown of total cost, installments, and due dates.
Construction Timeline	Expected start and completion dates of the project.
Amenities	List of basic facilities like water, electricity, and parking.
Delivery Date	Scheduled handover date of the property.
Builder’s Liability	Penalties or compensation in case of delays.
Legal Terms	Rights, obligations, and dispute resolution clauses.

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How To Write an Application for Land Allotment Letter

Here is an allotment letter format for you as per the latest land allotment letter guidelines.

Section	Description
To	Mention the recipient’s name and address (top left).
Date	Include the date of issuance (top right).
Salutation	Start with 'Dear Sir/Ma’am'.
Buyer Details	Full name, address, and contact details of the buyer.
Property Details	Building name, unit number, carpet area, and location.
Payment Terms	Total cost, installments, and payment due dates.
Construction & Delivery	Expected timeline and handover date.
Legal Clauses	Rights, obligations, and penalties for delays.
Signature	Authorized signatory with name and designation.

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How to Obtain a Letter of Allotment?

Step	Description
1️⃣ Expression of Interest	Apply with the developer or authority to book a property.
2️⃣ Submit Required Documents	Provide ID proof, address proof, and financial details.
3️⃣ Pay the Booking Amount	Make an initial payment as per the builder's policy.
4️⃣ Verification Process	The developer verifies documents and payment details.
5️⃣ Issuance of Allotment Letter	Once approved, the letter is issued to the buyer.
6️⃣ Collect the Letter	Obtain a signed copy in person or via registered email.
7️⃣ Verify Details	Check property details, payment terms, and delivery date.

Official Website of Some States for Allotment Letter

Sr.NO	Official Website of Some States
1	Madhya Pradesh
2	Maharashtra
3	GOA
4	Uttar Pradesh
5	Delhi

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Legal Aspects and Validity

✔️ Legal Status – Serves as proof of property allocation but not ownership.
⚖️ Enforceability – Legally valid if issued by an authorized developer or authority.
📜 Validity Period – Remains valid until the sale deed is executed.
⚠️ Dispute Resolution – Can be used in legal claims if conflicts arise.
🏦 Loan Approval – Required by banks for home loan processing.
⏳ Builder’s Liability – Defines penalties if the project is delayed.

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Difference Between Allotment Letter and Sale Deed

Aspect	Allotment Letter	Sale Deed
Purpose	Confirms property allocation.	Legally transfers ownership.
Legal Status	Not a proof of ownership.	Legally binding document.
Issued By	Builder or authority.	Registrar after full payment.
Validity	Valid until sale deed is executed.	Permanently valid.
Use in Loans	Required for loan approval.	Mandatory for property mortgage.
Transfer of Rights	No ownership rights granted.	Gives full ownership rights.
Legal Disputes	Can support claims but not final proof.	Strong legal proof of ownership.

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Common Mistakes to Avoid

🔴 Not Verifying Details – Always check property size, location, and payment terms before signing.

🔴 Ignoring Legal Clauses – Understand the terms, conditions, and builder’s liability in case of delays.

🔴 Incomplete Payment Terms – Clarify installment plans, due dates, and penalties to avoid issues.

🔴 Confusing It with a Sale Deed – The allotment letter does not transfer ownership; a sale deed is required.

🔴 Skipping Delivery Timeline – Check the handover date and confirm the builder’s responsibility for delays.

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What to Do If You Lose Your Letter of Allotment?

🟢 File a Police Complaint – Register an FIR at the nearest police station to prevent misuse.

🟢 Inform the Developer/Authority – Notify the builder or housing authority about the lost document.

🟢 Request a Duplicate Copy – Submit a formal application along with the FIR copy and ID proof to get a duplicate letter.

🟢 Get It Notarized – Ensure the duplicate letter is notarized and signed by the issuing authority for legal validity.

🟢 Update Your Bank & Loan Provider – If you have a home loan, inform the bank and provide the new document.

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FAQs

Que: What is a Letter of Allotment in real estate?
Ans: It is an official document issued by a builder or authority confirming property allocation to a buyer.

Que: Does a Letter of Allotment grant property ownership?
Ans: No, it only confirms allocation; ownership is transferred through a registered sale deed.

Que: Is a Letter of Allotment mandatory for a home loan?
Ans: Yes, banks require it as proof of property allocation for loan approval.

Que: What key details are included in a Letter of Allotment?
Ans: It includes buyer details, property specifications, payment terms, delivery date, and legal clauses.

Que: Can a Letter of Allotment be canceled by the builder?
Ans: Yes, in case of non-payment or non-compliance with agreed terms, the builder may cancel it.

Que: What should I do if I lose my Letter of Allotment?
Ans: File an FIR, inform the builder, and request a duplicate copy with proper documentation.