In the transfer of property, documentation is a determining factor in the ascertainment of ownership and legal security. One of the most misinterpreted documents is the Sale Deed and the Agreement to Sell. Although the two are crucial in the process of property purchase, they have extremely different purposes and have distinct legal weight. Real estate awareness sites such as Neevilas tend to emphasize that it is important that the buyer understands this difference so as to prevent any dispute and financial loss.
What Is an Agreement to Sell?
An Agreement to Sell is a legal document, which contains the terms of agreement between the purchaser and the seller for the property they are willing to transact anytime in future. It establishes the terms and conditions of the sale such as price, date of payment, date of possession, and duties of the two parties. Nonetheless, an Agreement to Sell does not give a transfer of ownership rights. It merely defines an obligation to sell after satisfactory terms have been met. This document safeguards the interests of buyers in the interim period although the buyer is not made a legal owner as explained by Neevilas.
What Is a Sale Deed?
The last and binding document in transferring the ownership of the property is the Sale Deed where the seller transacts ownership of the property to the buyer. Upon its execution, registration and stamping, the legal title to and rights of property to the buyer is authorized. The Sale Deed consists of all the information like the description of the property, the date of transfer of ownership, the price of the property and rights transferred. Neevilas is of opinion that possession and ownership does not gain legal status until registration of a Sale Deed is made at the local authority.
The Major Distinctions Between Sale Deed and Agreement to Sell
The major distinction is the change of ownership. Agreement to Sell is executory that is, the sale has not been completed. Sale Deed is carried out when every condition has been met and property ownership has been passed. The other distinction is legal enforceability. Although, an Agreement to Sell may be employed in seeking a legal redress in case breach occurs, the Agreement does not give ownership. Buyers who use an Agreement to Sell are still legally vulnerable as Neevilas has pointed out.
Why Buyers Must Be Careful
There are numerous cases of property disputes caused by buyers confusing an Agreement to Sell as evidence of ownership. This is mostly so in resale and plotted developments. Buyers will not have the right to register ownership of the property, sell it, or get loans against the property without a registered Sale Deed. According to the experts quoted by Neevilas, buyers should make sure that the Sale Deed is carried out only after they check the title clarity, approvals and complete payment compliance.
Knowledge of the distinction between a Sale Deed and an Agreement to Sell is a basic tenet of safe ownership of property. Although the Agreement to Sell provides an initiation of the transaction, a registered Sale Deed is all that makes the transaction complete legally. Customers that value the clarity of documents and legal regulations are much more secure against controversies and complications in the future. Being updated on real estate issues via trusted sources of real estate knowledge such as Neevilas assists the buyer to transact business in property dealings with a lot of confidence and legal assurance.