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Things To Keep In Mind About Property Transfer

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Everything About Property Transfer

Homeowners seeking to sell their properties should be aware of the various guidelines that need to be kept in mind during a property transfer   

There can be various situations when a homeowner wants to transfer the rights of his property to someone else. The transfer of a property in India is regulated by the Transfer Of Property Act, 1882.

Various things need to be kept in mind while such a transfer occurs as it requires several property documents. The homeowner and the person to whom he is transferring the property need to follow the property transfer procedure. Usually, the transfer of a property takes place for gifting, selling or due to some illness of the current homeowner. 

RealtyNXT lists the essential things that one must know about property transfer.

1. Memorandum Of Understanding (MoU)

An MoU is a legal agreement between two or more parties that is used in various situations. In the case of transfer of a property, it is the first and one of the most important documents that need to be signed by the seller and the buyer of the property.

It contains details about the property like details of the seller and the buyer, date of the legal transfer applied, date of purchase and when the full payment will be made by the homebuyer. 

Consulting A Lawyer

The transfer of a property requires complex paperwork and legal knowledge. Consulting a lawyer makes sure that all the legal procedures are followed and no mistakes are made in the entire process of transferring the property. There can be various circumstances under which the lawyer can help a homeowner.

In case a relative is compelling the homeowner to transfer the property in their name, the lawyer can help the homeowner by raising this matter in the court. Also, in case of any future challenges faced by the homeowner, the lawyer can help minimise the matter.

Lawyers also help resolve a crisis in case of the death of a homeowner without a valid “will”. A will is a legal document in which the homeowner expresses how or to whom he wishes to distribute the property after his death. 

Sale Deed

It refers to a legal document that states that the property that is to be transferred is free from any kind of legal dispute. A sale deed documents any property transfer made through sale or purchase. It ensures that any outstanding loan on the property is cleared by the seller and if not, it must be cleared before the transfer.

The sale deed also includes the bank details and stamp duty. The stamp duty that is imposed on the sale deed varies from one percent to eight percent across different states in India. In Mumbai, it is 5 percent of the total cost of the property.

Transfer Deed

It is also known as the assignment deed. This document is used while transferring the existing property title to someone else. It also ensures that the rights of the property and the benefits arising out of it are transferred to the person to whom the homeowner transfers his property. 

Relinquishment Deed

This document is required when the property is owned by more than one person. It is used if one of the owners wants to transfer the property to the other owner and relinquish his share in the property.

Once signed, this deed is irreversible the stamp duty imposed on it depends on the percentage relinquished by the owner of the property and not on its total value. This means that if an owner relinquishes 35 percent of the property, then the stamp duty imposed on it will be 35 percent of the property value.

Gift Deed

This document is required when the homeowner wants to transfer the property to someone else without the exchange of money. It has to be written on a stamp paper, attested by two witnesses and registered to the sub-registrar office. Once all the procedures are followed, the entire process is irreversible. 

Legal Description Of The Property

In all the legal documents, the precise description of the property is important while transferring the property. The address, landmark, any important specifications and dimensions must be mentioned. 

ALSO READ: 5 Things You Must Know About Property Redevelopment

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