A Deed of Sale is a contract for the sale of property between a buyer and seller. The Deed of Sale results in the seller transferring ownership over the property to the buyer.
Last updated on 24 November 2023
A Deed of Sale is a contract where (a) the seller sell property to the buyer; and (b) the buyer pays the purchase price for the property. The Deed of Sale results in ownership over the property being transferred to the buyer once the seller delivers the property to the buyer.
A Deed of Sale (similar to a Contract to Sell) contains the basic terms of the sale such as (a) purchase price; (b) payment terms; and (c) warranties.
Government agencies sometimes require a notarized Deed of Sale to process the transfer of the Certificate of Title over the property from the seller to the buyer. These are usually required by the Register of Deeds (for land) and Land Transportation Office (for cars).
We also have specialized Deed of Sales for land and vehicles, see below:
In a Contract to Sell, the seller retains ownership over the property until the buyer fully pays the purchase price. Once the purchase price is fully paid the seller delivers the property to the buyer and transfers ownership over the same to the buyer by executing a Deed of Sale.
In a Deed of Sale, the buyer acquires ownership over the property once the seller delivers the property to him. Usually, the parties execute a Deed of Sale after the conditions stated in the Contract to Sell have been met (e.g. full payment of the purchase price).
A Deed of Sale protects both the seller and the buyer. For the buyer, the Deed of Sale is proof that he / she bought the property from the seller and owns the same. The buyer can also enforce any warranties contained in the Deed of Sale if there is any defect in the product or problems with the sale in general.
For the seller, the Deed of Sale is useful if the buyer refuses to pay the purchase price or violates the terms of the sale (e.g. fails to follow the agreed payment terms). The seller can demand the buyer to pay the purchase price. If the buyer still refuses to pay the seller can file a complaint in court to either (a) enforce payment; or (b) cancel the sale, and claim damages from the buyer.
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