When you are looking for a property, the paperwork processing that you will encounter can seem daunting. However, understanding what document is required and how it works will help alleviate your worries.
This article will give an overview of what you need to know about the different types of papers that you might come in contact with when searching for a property or investing in real estate. These are some of the most critical information that one should have before making any purchase decisions.
Property Title
When looking for homes for sale, the most common question that arises is, “Who owns the house?” This information is essential in ensuring that you are not getting into any legal issues in the future.
Any property must have a legal title, which is the document that shows who legally owns the property. And when you are buying a property, you will need to transfer the previous owner’s title to your name.
It is recommended that buyers hire a lawyer to ensure that they are getting the proper title when purchasing properties. It also makes it easier to transfer ownership when you decide to sell your home someday.
Contract-to-Sell
A Contract-to-Sell is a document used to outline the sale of a property. The buyer and the seller usually sign this document, and it states the agreed-upon purchase price of the property, as well as the date by which respective parties will finalize the sale.
Anyone can use this document to protect both the buyer and the seller. It ensures that they are not paying more than what was agreed upon for the buyer. And for the seller, it guarantees that they will be able to sell their property at the set price.
If you are thinking of buying or selling a property, it is highly recommended that you have a Contract-to-Sell in place. It will help avoid any confusion and misunderstandings in the future.
Survey/Floorplan
Another essential document that you might need is a property floor plan or survey.
This paper gives you a detailed look at what the property looks like. It includes frontage, lot size, measurements within the compound, and the location of your home concerning the rest of the property.
If you are planning on buying a lot or land, this document will be crucial as it will give you a clear idea of where your current and future structures will stand. In addition, if there is a new road being built in the area, the surveyor’s map will show you how it will affect your property.
This document can be beneficial for future purposes, and it is recommended that you acquire one before making any purchase decisions to avoid uncertainties in the future.
Existing Debts
Once you have found a property that you like and want to own for yourself, the next step is to check if there are any debts or liens on the house. If there are, you need to know how much they are and who is responsible for paying these debts.
This information will help you determine if the property you want to purchase is worth what it costs or if it would be better to negotiate a lower price because of the debts found on the property. You can find this information on the property profile most of the time.
Ensure that there are no penalties or if any terms have been violated. Since legal proceedings might go against you, it is essential to know what you are getting yourself into before purchasing.
Property Transfer Tax
When purchasing real estate for sale, there is also a tax that the government needs to pay. This property transfer tax varies among provinces or states. But in most cases, buyers do not have to pay the tax.
The real estate agent will usually take care of these taxes on their client’s behalf. It’s best to ask your agent what they are doing with the property transfer tax because there might be some instances where it needs to be paid by the client directly, depending on the agreement with the seller.
Deed of Absolute Sale
The Deed of Absolute Sale is a document that legally transfers the ownership of a property from the seller to the buyer. This document is signed and notarized, and it is the final step in the sale of a property.
Once this document has been signed and finalized, the buyer becomes the rightful owner of the property, and the seller no longer has any claim to it.
So there you have it — the essential documents you will encounter when buying or selling a property. It is crucial to have the above documents in place to protect both parties and ensure a smooth transaction. And good luck with your property purchase or sale.
