Buying or selling a home is a major milestone in many people’s lives. However, the legal documentation involved often gets overlooked. One critical document is the conveyance deed, which legally transfers the ownership of property from the seller to the buyer. A real estate transaction is not considered complete without a proper conveyance deed.
Whether you’re a first-time real estate investor or a homebuyer, it’s important to understand the conveyance deed’s meaning to ensure your rights are protected when transferring property ownership. This article will explore the conveyance deed’s meaning, purpose, types and the process of obtaining it.
What is the conveyance deed meaning?
A conveyance deed, meaning a deed of conveyance, is a legal document that facilitates property transfer from one party to another. This document effectively conveys ownership rights and titles of a property.
It serves as written proof of the transfer of ownership, legally documenting the sale or transfer of real estate. This property transfer document is a binding agreement that ensures the transaction is legally recognised and valid.
A conveyance deed includes the following components-
– Details regarding the clear boundary of the property
– Information of all parties involved
– Signatures of all parties involved
– Terms and conditions of the transfer
-Sale agreement
– The historical record of property ownership, otherwise known as the “Chain of Title.”
– Information regarding any other relevant transfer of ownership rights.
What is the purpose of a conveyance deed?
The primary purpose of a conveyance deed is to serve as legal proof and validate that the property rights have been conveyed from the seller to the buyer. This helps protect both parties in case of any future disputes over ownership.
Another reason why a conveyance deed is important is because it indicates that the property is free of any liens, claims or other encumbrances that could impact clear title. This gives the buyer confidence that they are receiving the property free and clear.
Moreover, having a proper conveyance deed is important due to the legal technicalities involved in property transfers. It helps prevent fraudulent claims or activities related to the land and saves you from potential issues down the road.
Properly executed and registered, a conveyance deed provides critical legal protection and transparency for all involved in the property transaction.
Types of conveyance deed
#1. Conveyance deed of freehold property
This deed grants the buyer full ownership rights and authority over the property. The seller uses it as the final legal document, transferring all rights to the new owner.
#2. Conveyance deed of leasehold property
This deed provides leasehold ownership, granting the owner rights within the interior walls but not over the exterior or structure. It means the buyer has rights to the property but not to the land, which remains with the landlord.
#3. Conveyance deed of property subject to mortgage
When dealing with a property that has a mortgage, the property owner cannot reside on the property as their permanent residence. However, they can access the premises and its facilities from time to time.
#4. Gift deed
A gift deed transfers ownership from the current owner to another party as a gift without exchanging money. It is often used for transferring family property.
Is a conveyance deed similar to a sales deed?
People often confuse between a sales deed and a conveyance deed. Although both involve the transfer of property ownership, there are some significant differences between them.
Difference between a sales deed and a conveyance deed
Distinction
Sales Deed
Conveyance Deed
Meaning
A sales deed is a property ownership transfer in exchange for consideration.
A conveyance deed is a transfer of the ownership of property, with or without consideration.
Consideration
Consideration is mandatory. It may or may not be monetary.
Consideration is not necessary.
Transfer of title
There’s a permanent transfer of title, right and ownership to the buyer.
It entails a temporary transfer of title, rights and ownership to the buyer.
Right to sell
The buyer can use or sell the property.
The buyer only has the right to use the property but not sell it.
How to obtain a conveyance deed?
Now that we understand the conveyance deed’s meaning let’s know how to obtain one.
Step 1: Verify property title
First, ensure that the seller has the legal right to sell the property by verifying the property’s title.
Step 2: Draft the sale agreement
Once the property’s title is confirmed, draft a sale agreement that outlines the transaction’s terms and conditions.
Step 3: Pay stamp duty and registration fees
Proceed by paying the required stamp duty and registration fees for the conveyance deed.
Step 4: Execute the conveyance deed
After paying the fees, execute the conveyance deed with the seller and buyer in the presence of two witnesses. Ensure all parties involved sign the deed.
Step 5: Register the deed
Lastly, register the conveyance deed with the Sub-Registrar of Assurances within four months from execution. This involves submitting the original deed and necessary documents while paying the registration fees.
Documents required
The specific documents required for a conveyance deed can vary depending on the state, but here are some common ones:
– Sale agreement
– Property card/mutation entries
– Certificate under Urban Land Ceiling Act, 1976
– Location plan, city survey plan, and approved layout plot plan
– Approved building plan/ structure plan
– Architect certificate about the entitlement of undivided interest in the common areas
– The property’s commencement and completion certificates
– Proof of stamp duty fee payment and registration
– List of owners of the property details
– The draft of the conveyance deed
Final thoughts
A conveyance deed is paramount in safeguarding buyers’ and sellers’ rights and interests. It is the linchpin of property transactions, legally binding the transfer of ownership while offering transparency and protection against future disputes. Without a valid conveyance deed, the entire real estate deal is vulnerable to legal challenges.
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07 June 2024
6 mins read
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