Buying a home in Uttar Pradesh is set to become safer. UP RERA has introduced new IFMS (Interest-Free Maintenance Security) rules that will protect the maintenance money collected from homebuyers.
The new rules will apply to projects across cities such as Noida, Greater Noida, Ghaziabad, and Lucknow.
Many homebuyers had complained that builders collected large amounts as maintenance security but did not clearly explain how the money was used.
With the new rules, builders will have to maintain proper records, keep the money safe, and hand it over to the Residents Welfare Association (RWA) in a transparent manner.
Why has UP RERA changed the rules?
According to UP RERA Chairman Sanjay R. Bhoosreddy, the new rules aim to bring transparency, accountability, and better financial management.
The maintenance security amount paid by homebuyers is meant for the long-term upkeep of common facilities like lifts, parks, and other shared areas. The new rules ensure that this money is protected, properly invested, audited regularly, and transferred to the RWA without any confusion.
7 Important Changes in the New IFMS Rules
Separate bank account is mandatory: Builders must keep IFMS money in a dedicated bank account. It cannot be mixed with other maintenance charges or the builder’s personal funds.
Money must be invested in the best FD: Builders will have to compare bank interest rates and invest the IFMS funds in the fixed deposit offering the highest return.
Full amount must be transferred to the RWA: When the project is handed over, the builder must transfer the entire IFMS fund to the RWA or the Association of Allottees.
Complete financial records must be shared: Builders must provide unit-wise collection details, expenses, audit records, and the final balance while transferring the funds.
Funds can be used only for maintenance: The money can only be spent on repairing or replacing common facilities such as lifts, parks, generators, and other shared infrastructure.
Annual CA audit for RWAs: RWAs must also maintain a separate IFMS account. The account must be audited by a Chartered Accountant,
and the audit report should be presented to members at the Annual General Meeting (AGM) within three months.
Project-wise IFMS rates: UP RERA has fixed different IFMS rates based on the type of project.
IFMS Charges Fixed by UP RERA
Group housing (residential): ₹20 to ₹100 per sq. ft., depending on the category of the flat.
Commercial projects (without central AC): ₹40 per sq. ft.
Commercial projects (with central AC): ₹50 per sq. ft.
Plotted developments: Separate rates have been fixed for residential and commercial plots.
What This Means for Homebuyers
The new UP RERA rules will give homebuyers greater confidence. Builders will no longer be able to divert maintenance security funds for other purposes.
At the time of project handover, RWAs will receive the complete fund along with proper financial records, making the entire process more transparent and accountable.
