Title Deed vs Sale Deed: What Every Homebuyer Should Know
Title Deed vs Sale Deed – A Must-Read for Homebuyers in India
If you are buying or selling property then you must've come across many property documents. Understanding the difference between a title deed and a sale deed can be confusing to many.
Because of their similarities, you often wonder, Is title deed the same as sale deed? They are not the same and cannot be used interchangeably. Both are important and serve different purposes. Let's walk through what these documents are and how they affect your property buying journey.
Title Deed: The Ownership Proof
A title deed is a property document that shows the legal owner of the property along with name written on the document. The deed is used while transferring the property as a proof of rightful ownership, while being sold or gifted.
It can be said that it works as a property’s identity card.
There are different kinds of title deeds:
• Sale deeds
• Gift deeds
• Lease/Rental Deed
• Warranty Deed
• Partition deeds
• Relinquishment deeds
• Mortgage deed
The Importance of a Title Deed in Property Ownership
The deed provides details on:
• The past inheritance and transfers on the property
• Details about the owner and their rights
• Property area, location, dimensions
• Outstanding loans and mortgages
You should get the title deed from the seller and verify its validity and the owner's rights before drawing up an agreement. It is important to have information on any outstanding loans, fines, mortgages, or disputes regarding the property. It will ensure a smooth transaction and prevent disputes and fraud in the future.
Sale Deed: The Transfer Proof
A sale deed is also a type of property document that is used while officially transferring the property’s ownership from the seller to the buyer. It contains all the property details, name of the buyer and the seller, and works as a legal proof of sale, once signed.
It makes the buyer the new owner of the property and gives him/her all the access to the authority they hold on property.
Why Sale Deed is Crucial for Safe Property Transactions?
It outlines important information like:
• Terms and conditions
• The date of possession
• The mode of payment
• That the property is free from claims and outstanding liabilities
• Information of the seller and the buyer
In order for a sale of real estate to be legal, it must be registered under the Indian Registration Act, 1908.
To safeguard yourself from fraud or disagreements, the sale deed contains all necessary information that you might need in the future to verify the specifications of your ownership. The sale deed is drawn up after the completion of all formalities and signed with two witnesses at the sub-registrar's office. The registration fees are paid by the buyer. When you register the sale document, it then becomes a verified document.
Major Difference between Title Deed and Sale Deed
A sale deed is a type of title deed. While a title deed is proof of ownership, a sale deed is like your "receipt" for buying property. The major difference is based on
Title Deed: Before Purchase
Make sure that the seller has ownership of the property before you pay anything. Check that there is transparency about the previous owners as well.
During a purchase, find out about outstanding loans, fines, and maintenance dues which should be specified on the title deed. This will ensure that you won't face any legal disputes or claims from them after you move forward with the transfer.
Sale Deed: During Purchase
The sale deed becomes legally valid only if it is registered with the government in the local sub-registrar office with the necessary payments. You can use it to verify your ownership rights after registration. It acts as proof that the possession of the property has been handed over to the buyer with no remaining claims or disputes.
Conclusion
Simply put, you can think of a title deed as a group of documents under which the sales deed falls. Understanding this difference helps you know what to look for while buying property. Always consult a lawyer while making such purchases to ensure that your investment is safe. Since buying property can be one of the most significant investments of one’s life, you wouldn't want to get stuck in legal complications or suffer any significant loss.
.webp)
.webp)
.webp)
