Conveyance Deed: Meaning, Types & Differences from Sale Deed

A conveyance deed is an essential legal document created during property transactions. It serves as proof of the transfer of ownership from the seller to the buyer and is crucial for safeguarding the interests of both parties. In this article, we will cover everything including conveyance deed meaning, types, purpose, and the differences between conveyance deeds and sale deeds.

What is a Conveyance Deed?

A conveyance deed is a legal document that transfers the ownership of a property from one party to another. It is also referred to as a property deed or a title deed. It is a crucial document as it outlines the rights and responsibilities of the property owner and provides legal proof of ownership. It is essential to understand the conveyance deed to ensure you have clarity of the terms and conditions associated with the transfer of property ownership. Failing to understand the conveyance deed may lead to legal complications, financial loss, and even property disputes.

Importance of Conveyance Deed in Property Ownership

The conveyance deed is essential for property ownership, as it establishes legal proof of ownership rights. It provides the buyer with a sense of security and assurance that they are the legal owners of the property. 

During times when a property owner seeks a loan against property with the lowest interest rates, the lending institution among other important documents also requires the conveyance deed as collateral.

A conveyance deed is a key document for property owners. Here’s why it matters:
●    Proof of Ownership- It shows that you are the legal owner of the property.
●    Gives Security- It assures the buyer that the property is legally theirs.
●    Needed for Loan- Banks ask for it when giving a loan against property with the lowest interest rates.
●    Avoids Disputes- It helps prevent ownership problems or fraud.
●    Important for Resale- It is required when selling the property in the future.

Types of Conveyance Deed

Three main types of conveyance deeds are commonly used in property transactions:

1. Deed of Assignment: This type of conveyance deed is used when the ownership rights of the property are transferred from the seller to the buyer without any changes to the property itself. 
2. Deed of Transfer: This is used when the ownership rights of the property are transferred from the seller to the buyer with changes to the property itself. 
3. Deed of Conveyance: This is used when the ownership rights of the property are transferred from the seller to the buyer without any conditions or restrictions. 

Understanding the deed of conveyance meaning and its different types helps in knowing how ownership of property can be legally transferred in different situations. Here are the common types:
●    Sale Deed- The most common deed of conveyance, used when a property is sold. It confirms payment and gives ownership to the buyer.
●    Gift Deed- Used to give property as a gift without any money involved. Stamp duty must be paid.
●    Exchange Deed- When two people agree to swap their properties legally.
●    Settlement Deed- Transfers property within a family, like dividing ancestral property.
●    Lease Deed- Gives the right to use a property for rent, but ownership stays with the owner.
●    Will Deed- Transfers property to heirs as per a will, effective after the owner’s death.

Legal Requirements for Creating a Conveyance Deed

Several legal requirements must be met when creating a conveyance deed. These include:

1. The deed must be in writing and signed by both the buyer and seller.
2. The deed must include a description of the property, including its boundaries and any rights or restrictions associated with it.
3. The deed must include the purchase price and any other terms of the sale, such as the date of transfer.
4. The deed must be executed in the presence of at least two witnesses who are not related to either the buyer or seller.
5. The deed must be registered with the relevant land registry or local authority to ensure its legal validity.

Steps to Follow for Creating a Conveyance Deed

The following are the steps to follow for creating a conveyance deed:

1. Prepare a draft of the conveyance deed that includes all the necessary details of the transaction.
2. Review the draft with both parties.
3. Once both parties agree to the terms and conditions, the deed should be signed by both the buyer and seller in the presence of witnesses.
4. Pay the applicable stamp duty on the conveyance deed as per the state government regulations.
5. Register the conveyance deed with the appropriate authority. 

Documents required for creating a Conveyance Deed

Below are the documents required for conveyance deed creation:

1. Title deed
2. Sale agreement
3. Proof of stamp duty and registration fees
4. Identity proof
5. Property tax receipts
6. Encumbrance certificate

Registration of a Conveyance Deed

A conveyance deed must be registered to make property transfer legal. As per the Registration Act 1908, an unregistered deed has no legal value and cannot be used in court.

Why Is Registration Important?

1. Makes it Legal- Registration confirms the property transfer is valid.
2. Proof of Ownership- It helps prove who owns the property.
3. Protects from Disputes- Prevents others from claiming your property.
4. Needed for Resale- You cannot sell the property without a registered deed.
5. Updates Land Records- Required for name change in government records

Format of Conveyance Deed

A conveyance deed follows a specific format to ensure it is legally valid. It includes details of the buyer, seller, property, and transfer terms.

Professional Assistance for Creating a Conveyance Deed

Professional assistance can be sought for creating a conveyance deed to ensure all legal formalities are met, the deed is legally valid, and the transaction is smooth. 

Importance of Registering Conveyance Deed

Registering a conveyance deed is crucial for transferring ownership of property legally. The conveyance deed becomes legally valid only after it is registered with the competent authority. 

But what if the conveyance deed is not registered? It may not be legally binding, and the transfer of ownership may not be recognized by the law. 

Understanding Conveyance Deed Vs Registry

Conveyance deeds and registry are two distinct documents that play different roles in property transactions. The conveyance deed serves as proof of ownership transfer from the seller to the buyer, while the registry is a legal record of the property ownership maintained by the government.

What is a Sale Deed and its Role?

A sale deed is a legal document that records the transfer of ownership rights from the seller to the buyer. It establishes the agreement for the sale of the property, including the terms and conditions of the sale, the purchase price, and other relevant details.

Difference Between Sale Deed and Conveyance Deed

The terms "conveyance deed" and "sale deed" are often used interchangeably, but they are not the same. Let’s understand the major differences between the two.

A deed of conveyance is essential for securing legal property ownership, whether through a sale or other methods like inheritance or gifting.

Legal Protections Provided by Conveyance Deed

The conveyance deed provides legal protections to both the buyer and the seller. For the buyer, it serves as legal proof of ownership, protecting them from any claims of ownership from third parties. For the seller, it protects them from any legal liabilities or claims that may arise after the transfer of ownership.

Ownership Transfer

The main difference between a sale deed and a conveyance deed is the type of ownership transfer they facilitate. While a sale deed records the agreement for the sale of the property, a conveyance deed transfers ownership rights from the seller to the buyer.

Legal Rights and Obligations

Another key difference is the legal rights and obligations they create. A sale deed does not establish the legal rights and obligations of the buyer and seller beyond the terms of the sale agreement. On the other hand, a conveyance deed creates legal proof of ownership rights and establishes the legal obligations of the buyer and seller regarding the property.

Stamp Duty and Registration Fees

The stamp duty and registration fees for a conveyance deed are typically higher than those for a sale deed. This is because a conveyance deed is a more comprehensive legal document that establishes ownership rights and legal obligations.

Conclusion

In a nutshell, a conveyance deed is a crucial document that must be created and registered during property transactions. It serves as evidence of the transfer of ownership from the seller to the buyer, and it safeguards the interests of both parties. Doing so can help to ensure that all legal formalities are met and that the transaction is smooth and hassle-free.

Frequently Asked Questions

1. Is Sale Deed and Registry Same?

No, they are not the same. A sale deed confirms property transfer, while the registry officially records it with the government.

2. Is Conveyance Deed Same as Registry?

No, conveyance deeds and registry are different. A conveyance deed transfers property, while a registry is the legal record of the transaction.

3. What is the time period for conveyance deed?

A conveyance deed should be registered within four months of signing to keep it legally valid.

4. How do I get an original conveyance deed?

The original conveyance deed is available at the sub-registrar’s office where it was registered.

5. What happens if a conveyance deed is not done?

Without a conveyance deed, the buyer does not have full legal ownership of the property.

6. Who executes the deed of conveyance?

The seller or owner signs the deed of conveyance to transfer the property to the buyer.

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