Agreement for Sale of a Freehold Property

This Packet Includes:

1. Description and Instructions

2. Agreement for Sale of a Freehold Property

Description and Instructions

Agreement for Sale of a Freehold Property

A contract for the sale of immovable property is a contract laying down terms and conditions for the 'Sale' of such property.

When ownership rights for a piece of property are given to the purchaser for a price, that property is referred to as freehold property. For a freehold property, ownership is for an indefinite length of time. In a freehold property the title paramount conveys the property in favour of the purchaser by conveyance/ sale deed with no restriction on the right of the holder of the property to further transfer the property. Record of ownership of the freehold property can be ascertained from the office of the Sub-Registrar. It can be transferred by registration of the sale deed. Freehold estates include freehold in deed, a fee simple estate; freehold in law, an inheritable estate; and determinable freeholds, a life estate.

The transfer by way of sale of tangible immovable property of the value of one hundred rupees and above must be made by a registered instrument. The transfer by way of sale of tangible immovable property of the value of less than one hundred rupees may be made either by a registered instrument or by delivery of the property.

According to Transfer of Property Act, immovable property does not include standing timber, growing crops or grass.

Some important features and instructions:

1. Terms for Payment
The purchaser and seller have to agree upon the terms on the price and other expense for transfer of property.

2. Transfer Title of Property
Title of property is important for the sanction of mortgage or loan from a bank. The title of property should be transferred to the purchaser when the seller receives the agreed amount for the sale. Transfer of title of property is the last step in the transaction. Seller has to register the property in purchaser’s name with the local registrar office that has jurisdiction over the property.

3. Stamp Duty
Stamp duty rates are fixed for properties by the authorities. The rate may vary from state to state. The purchaser has to ensure that seller has registered the property in purchaser’s name on the rate levied for the property transferring.

4. Registration

All the documents to be registered must be accompanied by a prescribed registration fee as determined by the State/region of jurisdiction.

Note: Please seek independent legal and financial advice when signing a sales deed and ensure all copies of documents including the sales deed is properly read and understood.

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