Sale Deed Property Registration in Pakistan

Sale Deed

Sale deed is a registered legal document in writing which transfer the ownership of the property in exchange for a price paid. This document is required to be registered with concern registration authorities. Whenever you enter into any sale of property, than the sales deed should be signed by both the parties .This document shows the transfer of titleand rights of the owner. It is the document that sets the foundation of selling property and is a must.  This document is a proof that the transaction is carried out between the buyer and seller which will help sort out any cases of possible fraud.

What is the purpose of sale deed?

Sale Deed describes the transfer of right, title and ownership of Property by a Seller to a Purchaser at a price either fully paid or to be paid in installments at a future date. Sale Deed also consider a document of proof that a Seller has sold his/her property to the buyer.

What is the process of the sale of a property?

The process of sell of a property is started when both the parties (Seller & Buyer) mutually agreed on a sale consideration (vale of property) and the terms & conditions which includes payment schedule and handing over the physical possession. Some of the following steps involved in the sell of a property

  • Conditional Token Money
      • Token money is a small amount paid by Buyer to the Seller at the time of initial confirmation of sale. This is conditional amount depending on the successful verification of property and its ownership otherwise it is retured by the Seller. Read more about Property Transaction Payments
  • Verification of Title
    • Verification of Title process involves the verification of property documents and ownership from respective authorities or societies. It is very much important to avoid fraud and any other legal implications before buying property.
  • No Dues Certificate
    • A No Dues Certificate (NDC) is also obtained from the Seller during the process to verify the applicable dues and other taxes of the property. Buyer verifies the dues and taxes from respective authorities or societies.
  • Agreement of Sale
    • After clearance of property ownership and applicable dues, an Agreement of Sale is prepared and signed by both parties. This agreement is also known as Bayana and it is usually made of 10% of the total sale consideration
  • Registration of Sale Deed
    • Registration of the sale deed process starts when the buyer pays the Full and Final payment to the seller. At that time, Sale Deed is registered at the sub registrar office of the town in presence of the lawyer.
  • Handing over Physical Possession
    • After full and final payment and the registration of sale deed or transfer of property rights, the seller handed over the physical possession of the property to the buyer with original property documents.

What are the essential elements of a sale deed?

Few of the essential elements of the Sale Deed are described below

  • Details of the Parties
    • The most basic details of the parties should be mentioned in the sales deed; the name, age, addresses, contact details etc. so that it is easy to verify both the buyer and seller.
  • Details of the Property
    • All the related details about the property ID number, dimensional area, addresses and construction details must be incorporated in the sales deed to verify the correct location of the property.
  • Sale Consideration
    • This clause will show the monetary amount that is to be dealt with. It will show the payments, the dates for the payments and the mode of payments so that no chance is left for any discrepancy.
  • Indemnity & Encumbrance Clause
    • This will be included to show that the sellers’property is legal and free of any corruption so it is safe to transfer.
  • Default Clauses
    • In case of default by any of the party this clause should be mentioned in the sales deed as it will set a penalty for the offending party so that the transaction is not affected by the execution of the sale
  • Delivery Dates
    • All delivery dates, installment dates should be completely specified in the sales deed.

What are the precautions to take before executing the sale deed?

Proper documentation should be put in place for purchase of the property. The sale document should be properly stamped and registered and the original title deeds should be taken by the purchaser from the seller.

What are the steps involved in the execution of sale deed?

The Buyer should contact a lawyer and put forward property details and other information to start the legal process promptly. When the payment is received the lawyer will start working on the document and prepare the first draft within a few days which you can then evaluate and modify if any need arises for correction.The installment payment will itself be a proof of transfer just like the sales deed will state in the document.

For execution, both the parties will sign the Sale Deed at the sub registrar office in presence of the lawyer while having at least 2 witnesses in confidence to ensure validity.  Both the buyer and seller should play their part in making sure that the transaction will be a success. Such as the seller should make sure that the property is free of any corruption while the buyer should make sure that the seller has rights of the property being sold. It is important that all the documents be original, verifiable and complete to authenticate the Sale Deed properly.

This article describes the usual practices carried during registration of Sale Deed. You can find more relevants articles on our Property’s Blog and Article section.

For further assistance and legal advice, you can contact our Property’s Legal Advisor on given number for prepartion of such documents.