| Conveyance deed | Sale deed |
| Conveyance deed is transfer of property rights and ownership from one person to another and need not be for consideration | Sale deed is needed when a property is sold to buyer in exchange of consideration |
| Consideration is not necessary | Always involves consideration- monetary or non-monetary |
| Transfer of rights of the property for a limited time period | Transfer of rights of the property is permanent. |
| While buyer can use the property, he can’t sell it. | Buyer has the right to use and sell the property. |
Conveyance is the process where the owner of an asset transfers the ownership rights to another person against a valid consideration (except for "gifts", where the only consideration is love and affection). With respect to immovable property, a conveyance deed is a legal document that protects the rights of a property owner. It can be referred to as a contractual document that is sealed and signed by all the parties involved in the property transaction and comprises bye-laws that are enforceable in the court of law.
A conveyance deed is an essential document required for the purchase of a property. We explain importance of deed of conveyance and what a home buyer should look out for, when signing the conveyance deed document
Conveyance refers to the act of transferring the title, ownership, rights and interests in a property from one person to another. The term deed refers to an instrument such as a written document that is signed by all parties involved in a transaction. That way, conveyance deed or deed of conveyance is a contract in which the seller transfers all rights to the buyer. Property transactions are not complete till a conveyance deed is executed and registered.
What is a Conveyance Deed ?
A conveyance deed is a legal document used to transfer the property title from one person to another as a gift, an exchange, a lease, a mortgage, etc. A gift deed, mortgage deed, lease deed or sale deed can also be called a conveyance deed.
When buying a house, you must have come across the term Conveyance Deed. The deed comprises several elements which bind it legally before the law and serves as proof in case of any future conflict.
Importance of Conveyance Deed
A conveyance deed is an important document that one needs when one owns a property:-
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Serves as evidence: If a legal dispute arises, the conveyance deed works as evidence. It will help resolve the issue soon.
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Proof of ownership: A conveyance deed works as proof of ownership. It mentions the ownership right of property.
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Transfer property rights legally: With a conveyance deed, you can quickly transfer property rights to another person.
Note: Please remember that conveyance deeds should be registered at the sub-registrar's office after stamping on non-judicial paper. The transfer is made public, and then the process of conveyance deed is completed.
What is the difference between a sale deed and a conveyance deed?
Conveyance deed is a broader term that includes any property ownership transfer in the form of a gift, mortgage, lease, exchange, etc., in favour of the buyer. A sale deed is a legal document to transfer ownership through a property sale. All sale deeds are conveyance deeds, but not all are sale deeds. All deeds used to transfer property rights are conveyance deeds, and the sale deed is among them.
What should be there in a conveyance deed?
The conveyance deed should have the following:
- Defined boundaries of the property
- Power of attorney (if any)
- Chain of title that includes all legal rights to the present seller
- The details on how the property will be handed over to the buyer
- A memo stating how property ownership has been received
- Signatures of both parties that imply the buyer and seller
- Other terms and conditions that are concerned with the property transfer
- Things to check before executing a conveyance deed
- The seller must clarify that the property is free from any legal encumbrance.
- In the case of mortgage property, the mortgage must be cleared before the deed is signed. Buyers can check these details at a local sub-registrar’s office.
- The conveyance deed must include the exact possession date on which the property will be handed to the buyer.
- Within four months of the execution of the deed, all the original property documents should be submitted at the local sub-registrar for registration.
- At the time of registration, the conveyance deed has to be signed by at least two witnesses.
Types of Conveyance Deed
Following are the different types of conveyance deeds:-
Freehold Property Conveyance Deed: This conveyance deed is created for a property converted into a freehold property by an authority.
Freehold Property Conveyance Deed: This conveyance deed is created for a property converted into a freehold property by an authority.
Leasehold Property Conveyance Deed: Leasehold property deed of conveyance is for leasehold ownership of property. A leasehold property is a property where an owner has the right to everything within the property's walls; nothing can be done on external walls.
Mortgage Property Conveyance Deed: A mortgage property conveyance deed is for the mortgaged property.
What is the use of a Conveyance Deed?
As we discussed, a conveyance deed is a legal document used to buy and sell a property. The presence of this document will save you from fraudulent activities. You must ask for a copy of the conveyance deed when buying a property.
What is the procedure for obtaining a conveyance deed?
A conveyance deed is drafted on a non-judicial stamp paper of requisite value and is registered at the nearest sub-registrar office. The buyer should pay post-registration, stamp duty, and registration fees. Each state has different charges for stamp duty and registration charges.
Who Prepares Conveyance Deeds?
To prepare a conveyance deed, you will need the help of a lawyer. They will create legal documentation of the transfer of ownership and authority. To ensure that it is a legal transaction, the government intervenes, and for the same, there is a requirement for a lawyer. Also, in some cases, you might need a real estate agent to document the deed properly between two parties. On the conveyance deed, a buyer has to pay a stamp duty.
What is the use of a Conveyance Deed?
As we discussed, a conveyance deed is a legal document used to buy and sell a property. The presence of this document will save you from fraudulent activities. You must ask for a copy of the conveyance deed when buying a property.
List of required documents for Conveyance Deed
- Registered Agreement for sale of property with the seller
- Mutation entries/ Property card
- Location plan and survey plan from the revenue department
- Layout plot plan and structure plan approved by the appropriate authority
- Certificates such as Commencement Certificate, Completion Certificate, Occupancy Certificate (exempted if not available), architect certificate
- An entire list of owners
- Stamp duty payment receipt
- If the seller executes the deal, power of attorney or development agreement is required
- Draft conveyance deed
- Importance of conveyance deed
- In case of any dispute, conveyance deed serves as an evidence
- It certifies that the property is free from disputes
- Acts as proof of land ownership
- Legally transfers the property rights to the buyer
Deemed conveyance deed
Once the state government issues a deemed conveyance deed, the law considers the deed to be executed even if the developer has not executed the conveyance deed. In order to have a deemed conveyance deed, one needs to apply with the required documents to the concerned authorities. The developer should also ensure that both the parties are present as the authority law would pass a judgment only after hearing both the parties.
The following are the documents required for applying a deemed conveyance deed:
- Relevant land documents such as land revenue, municipal records and the like.
- A copy of the agreement between the landlord and the developer regarding the development of a property.
- Registered and stamped agreement copies of each flat.
- A copy of the approved building plan.
Frequently Asked Questions
The conveyance deed is a legally document that signifies that the seller of a property has transferred all the authority and the ownership regarding a property to the buyer.
Conveyance may occur either through a sale of the land or property or transfer as a gift or inheritance.
Yes, if you are planning to avail a home loan, you will have to submit the conveyance deed.
It is a legal document that is exchanged between a a transferor and a transferee and consists of ownership rights of the property being transferred.
The terms conveyance deed and sale deed are often used interchangeably and while they refer to the same contract, there is a subtle difference between the two. All sales deeds are conveyance deeds but conveyance deeds can also include gift, exchange, mortgage and lease deeds.
A conveyance deed can be challenged and cancelled if it was formed with fraud or misrepresentation of information.
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