Registration of Agreement of Sale

Registration of Agreement of Sale: Know the Importance

When purchasing a property, there are many legal processes involved. One of these processes is the registration of the agreement of sale. It is a must for the buyer and seller to register the agreement to complete the transaction and make it legally valid. In this article, we will discuss the importance of registering the agreement of sale.

What is the Agreement of Sale?

An agreement of sale is a legal document that outlines the terms and conditions of the sale of a property. It includes details such as the property`s description, the purchase price, payment terms, and other relevant information. Both the buyer and seller sign the agreement, indicating that they agree to the terms and conditions of the sale.

Why is Registration of Agreement of Sale Necessary?

Registration of the agreement of sale is crucial for several reasons:

1. Legally Binding:

The registration of the agreement makes it legally binding in the court of law. It serves as evidence of the sale agreement and helps resolve any disputes that may arise in the future.

2. Transfer of Ownership:

Registering the agreement of sale establishes the transfer of ownership of the property from the seller to the buyer. It also helps in updating the land records and the municipal corporation records, which are necessary for obtaining a clear title.

3. Avoids Legal Hassles:

If the agreement of sale is not registered, it can lead to legal hassles in the future. The buyer may face difficulties in getting the property`s possession and ownership, and the seller may face litigation issues.

4. Helps in Obtaining Bank Loans:

Banks and financial institutions require a registered agreement of sale as proof of ownership of the property. It helps in obtaining a loan, and the buyer can use it as collateral for further loans if necessary.

5. Property Tax:

Registering the agreement of sale is necessary for the payment of property tax. It is necessary to update the property tax records in the name of the new owner to avoid any legal issues.

Conclusion

Registering the agreement of sale is crucial for the buyer and seller to complete a property transaction legally. It helps avoid legal issues, establishes the transfer of ownership, assists in obtaining bank loans, and enables payment of property taxes. Therefore, it is essential to understand the importance of registering the agreement of sale and ensure that the transaction is legally valid.