Look-Out-Sale-DeedA property investor should always go for an authorised property that has no legal issues. A sales deed is an important document for such purpose as it provides the house owner complete legal protection against any ownership dispute.

When buying a property, you’re expected to have all the necessary paperwork spick and span so as to avoid unnecessary legal complications. A sales deed is that one document that can act as a major shield against all sorts of legal hassles. With the complicated nature of a sale deed, understanding each and every aspect becomes essential. Read on to know 5 things you should look out for in a sale deed.

Defining a Sale Deed

A sale deed is a valuable legal document which comes into play during the sale or purchase of a property. The Indian Registration Act governs the contents of a sale deed and it is a crucial document for both the parties (seller and buyer). If one is selling or purchasing a property without the sales deed, the deal is considered incomplete. To avoid such situations, one must sign the sales deed soon after both the parties reach an agreement with regards to the various conditions and terms that are laid down in the agreement.

Preparation of a Sale Deed

The process commences when both the seller and buyer agree to draft a sale deed that is usually prepared on a non-judicial stamp paper. The sale deed value differs from one state to another in India. Once there is an agreement on the detailed contents of a sale deed by both the concerned parties, the deed is ready to be signed. But to finalise it, there should be at least 2 witnesses present during this process.

Things That a Sale Deed should Contain

Irrespective of whether you are a seller or a buyer of a property, here are some of the vital things to look for in a sale deed.

1. Basic Details: A sale deed should contain all the basic details such as the names of both the selling and buying parties, their addresses, and all other details such as the property’s identification number, the address, dimensions of the property in question, and the construction details (in case of a house).

2. Details of Amount to be Paid: Your draft sale deed should compulsorily include the total amount that needs to be paid for the sale or purchase of a property, details of advance amount paid (if applicable), dates of payments that have already been made, bank transaction details for the payments, and the time that has been allotted for the payments.

3. Date of Handover: There should be a clear mention of the exact date on which the documents related to the original property should be handed over by the seller to the buyer. This document should also have a mention of the date of possession for the buyer to take over the property. A mention of the indemnity provisions for both the concerned parties should be made in the draft sale deed.

4. Free from Encumbrances: It is very important that the sale deed contain a statement where a seller certifies that the property in question is free from all forms of legal impediments without any lien attached to it. It should be duly noted in this context that a seller can only execute a sale deed only after the loan borrowed to purchase the concerned property has been settled. This can be found out through an official application to the local registrar’s office.

5. Details about the Payment Receipt: A buyer should check out whether a deed includes the relevant statements about the receipts that had been issued by the concerned seller to the buyer of the property with respect to the money the former received from the latter towards that sale transaction.

While a buyer makes the payment for the registration charges and the stamp duty, the seller should make sure that all due payments with respect to the property such as electricity charges, water charges, and cess and property charges have been paid before execution of the sale deed.

So, do cross-check all the aforementioned details before you put your signature on those dotted lines.

With all this relevant data about sale deeds, you can start short-listing properties from commonfloor.com to find that perfect home.