A conveyance deed is an essential document required for the purchase of a property. We explain its importance and what a home buyer should look out for, when signing the document.
Conveyance refers to the act of transferring the title, ownership, rights and interests in a property, from one entity to another. The term ‘deed’ refers to an instrument, like a written document that is signed by all the parties to a contract, in this case, the seller and buyer. It is a binding contract that is enforceable in a court of law.
A conveyance deed is, therefore, a contract in which, the seller transfers all rights to legally own and keep a property. The purchase of a property is not complete without a valid conveyance deed. 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 valid conveyance deed must contain the following:
- The actual demarcation of the property.
- Other rights annexed to the property and its use.
- The full chain of titles, that is, all legal rights up until the present seller.
- The method of delivery of the property to the buyer.
- A memo of the consideration, stating how it has been received.
- Any further applicable terms and conditions for the full transfer of ownership rights.
Important points to consider, to ensure smooth purchase/sale of a property
- The seller is required to certify that the property is free of any legal encumbrance.
- If a loan was taken against the property in question, then, the mortgage must be cleared before the deed is signed. Buyers have the option of having this checked at the local sub-registrar’s office.
- The conveyance deed should state the exact date on which the property will be handed over to the buyer.
- Within four months of the execution of the deed, all the original documents related to the sale of the property, need to be produced for registration before the local registrar.
- The deed is required to be signed by at least two witnesses.