What does the title deed entail? What is the difference between a sale deed and a title deed? And what are the purpose of the sale and title deed? These questions will no longer bother the readers once they read this article.
Title deed is a popular term often used by real estate agents today; we shall try to understand what it means, its implication, and the difference between title deed and sale deed.
Real estate business refers to the business of buying and selling property, and its popularity as a career option is as high as ever. When a not-so-experienced person tries to sell or even buy property, they are sure to get their brains tangled after hearing the complicated terms these real estate agents use. The real estate business is full of jargon, which can create confusion, making an already difficult process more convoluted. But there is no need to get intimidated by these fancy terms. They usually are pretty simple, meaning terms and easily comprehensible too. Consumers must be aware of the basic meaning and understanding of terms such as escrow, sale deed, due diligence, closing costs, etc.
When a customer deals with their property with a potential client, it is in their best interest to know about their rights and liabilities. Title deed is one of these jargons. There is much confusion between sale deeds and title deeds, but it is important to note a small difference between the two.
Title deeds in India are legal rights to own property. Though it is not an actual document, its value is still very much unquestionable. We are about to delve deeply into these concepts to completely clear every buyer’s dilemma.
What is the title deed?
According to the dictionary, a title deed is a document that declares and proves a person’s legal right to own land or a building.
There are plenty of dictionary definitions of the meaning of title deed, but if we put it in layman terms, it is a legal right to own something, most commonly a piece of land or immovable property.
When you get the legal ownership of a property through property registration, the title of that concerned property is transferred to you. Still, the sale deed is the legal instrument that allows this transaction to take place. This is why the phrases title deed and sale deed are sometimes used interchangeably.
The legal term for owning a right to anything is a title. In the context of real estate, the title denotes ownership of the property, implying that you have the right to utilise it. It might be partial or complete ownership of the property.
Once the lengthy process of reaching an agreement for a property between real estate agents and buyers is done, they have to put together the procedure to prove that the property in question has seen a change of ownership. They must next construct a document called a sale deed, which contains every detail about the transaction. This must be registered to become legally legitimate under the Registration Act of 1908. A sale deed becomes legal proof that the property title has been transferred into the buyer’s name as soon as it is registered. A sale deed becomes a title deed when it is used in this capacity.
What is a sale deed?
The meaning of the sale deed is pretty straightforward. The sale deed is the primary document by which a seller transfers his right to the property to the buyer, who subsequently becomes the owner of the property in its entirety. The conveyance deed is another name for it. Immovable property sale deeds must be registered with the jurisdictional sub-registrar office. At the moment of registration, all people involved must be present. This is why the ultimate aim of a sale deed is to say that a property has been transferred in the name of such and such person. All facts relevant to the buyer/buyers and the seller/sellers are included.
It can also be called a title deed in India because this document establishes the buyer’s possession. Therefore, it automatically becomes a declaration regarding the property’s title. This is why there is much confusion regarding the two. A selling deed is also documentary evidence of the title transfer of the asset and the historical ownership that the parties must demonstrate at the time of property registration.
Difference between the two
The most principal difference between the two is that a title deed is a concept, whereas a sales deed is an actual document of transfer of property. A sale deed becomes a title deed when it acts as a statement to show your legal right to own the property. Similarly title deed becomes a sale deed when it becomes a legally binding document.
The legal difference between title deed and sales deed
The sale document lays forth all of the terms and circumstances under which the buyer and seller agreed to complete the transaction. Legally, the difference between these two is that one is an agreement, and the other is a statement. Legally speaking, a sale deed is an actual physical document, while a title deed is defined as the legal right to own immovable property. Under the registration act 1908, sales deeds have to be registered in the sub registrar’s office.
The owner’s rights and duties are also spelled forth in the title documents. Thus, the title deed is a declaration that exclusively applies to the legitimate ownership over certain property, despite the fact that it is uttered through a sale transaction.
In a nutshell, the basic difference between title deed and sale deed in layman terms is- A sale deed is a contract, but a title deed is a declaration, and while a sale deed is a physical document, a title deed is a concept.
Now that we have understood the difference between these important real estate terms, it is now time for us to learn the importance of title deeds. Since it is not a physical document, buyers are sometimes unclear about the importance of this deed. But it is without doubt quite important and plays a crucial role in the smooth transaction of properties.
Importance of title deed:
In circumstances where the property owner has to prove their right over a property, these title deeds come in handy. To provide protection against illegal settlers, having a title deed is indeed a blessing, and it gives clear protection to the rights of these property owners. It serves as proof of ownership and helps in asserting and exercising the owner’s property rights.
Every ownership transfer is documented in writing, and the document is referred to as a deed. This might be a gift deed, sale deed, transfer deed, or Will, depending on the nature of the transaction. This document serves as a title document for the transferee, which he preserves as proof of ownership.
When there is a property transfer, it is critical to have the necessary property papers and to have the municipal/revenue records updated so that the property stays safe.
Additional functions of title deed:
- It is vital to acquire a bank loan. Banking institutions require the submission of ownership documents as collateral for a loan. Banks use such contracts to transfer ownership and reclaim their debts when there is a default.
- The existence of the document also aids in determining the legitimacy of the real estate transaction.
- Lastly, it contains information regarding the property’s obligations.
Sale deed
A sale deed is one of the most important papers in the sale or purchase of a property, and the Registration Act controls it. Both the buyer and the seller value the deed equally. Only when both the buyer and the seller have signed the sale deed, then only it is legally finalised. Both parties must adhere to the terms and conditions laid out in the contract.
What does the term “sale deed” entail?
The selling deed is a legal document that proves the buyer’s ownership of the immovable property and includes all pertinent information. The sale deed is written on non-judicial stamp paper with a value determined by the state government in which the property transaction occurs. Stamp paper, which is used to draught immovable property, has a predefined value in each state.
What happens if you lose the original sale deed?
The functions and importance of the sale deed are indeed immense. It is the basic proof of ownership of property. Therefore, preserving documents of such high value is crucial. But what happens if, under some circumstances, the owner loses him/her original sale deed. What is the next step that the concerned party can take to protect their rights as property owners?
It is quite clear that losing a document of such importance is problematic. There is a legal procedure to acquire a duplicate copy of your lost sale deed. Following these steps, as soon as you find out that the original copy is lost, can help in the acquisition of a duplicate copy of the sale deed:
- The first step is to lodge an FIR complaint with your nearest police station. The first information report or FIR is crucial to finding any lost object. File an FIR (first information report) with the local police station, including all of the property’s details. If the document were lost due to a crime or theft, the police would usually endeavor to track them down. The police will offer you a non-traceable certificate if they are unable to locate your lost sale deed. A non-traceable certificate is a written document that states that the police could not locate the lost item. This certificate plays a crucial role in getting a duplicate copy.
- The next step is to advertise in the local newspapers. This shows that you have tripped to locate your lost document and thus proves that your losing your document is a genuine concern. The advertising will include all of the pertinent information about the property. The purpose of the advertising is to raise awareness about the theft so that members of the public may help return the papers to their rightful owners if they know anything about them and happen to find them. This advertising is a further indication that the document’s owner has misplaced it. If you cannot locate your lost document even after these two steps, the next and final step is to approach the registrar’s office.
- It’s time to write an affidavit. First, you must write to the sub-registrar where the property was registered on plain paper, alerting them of the missing sale deed and all other details surrounding the occurrence. This affidavit, along with one copy of each of the FIR, non-traceable certificate, and newspaper advertisement, must be registered with a public notary. The sub-office registrars will accept your application for a duplicate copy of a sale deed after reviewing the papers. You will also have to pay a small charge and the application, which varies by location. The duplicate copy might take anywhere from 15 to 30 days to arrive.
In a world where lack of knowledge can be a problem, being aware of your rights as consumers are very important. Therefore, knowing the meaning of title deed and sale deed is crucial before stepping into the real estate business as a consumer. In this blog, we have cleared all the doubts buyers may have regarding the differences between sale and title deed.
FAQ:
Which act deals with the title deed?
Article 15 of the registration act, 1908 talks about title deeds and the importance of registration.
What is a deed?
A signed and delivered legal document, especially ones pertaining to property ownership or legal rights.
What is an example of immovable property?
“Immovable Property” refers to land, buildings, inherited allowances, rights to routes, flights, ferries, and fisheries, as well as anything fixed to the soil.
What is escrow?
A legal arrangement where a third party holds huge quantities of money or property for a period of time until a certain condition is satisfied (e.g., the fulfillment of a purchase agreement).
Is there a physical copy of a title deed?
No, there is no physical copy of the title deed.
