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Things you need to know about Deed of Sale.

1. What is a Deed of Sale?

A Deed of Sale is a contract where (a) the seller delivers property to the buyer; and (b) the buyer pays the purchase price. The Deed of Sale results in ownership over the property being transferred to the buyer upon its delivery.

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. While the Deed of Sale can be used for the sale of any property it is most commonly used for (a) land; (b) houses; (c) condominium units; (d) cars; and (e) other property with significant value.

Government agencies sometimes require a notarized Deed of Sale to process the transfer of the Certificate of Title over the property to the buyer. These are usually required by the Register of Deeds (for land) and Land Transportation Office (for cars).

2. What is the difference between a Contract to Sell and a Deed of Sale? 

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 upon its delivery to him. Usually, the parties execute a Deed of Sale once the conditions stated in the Contract to Sell have been met (e.g. full payment of the purchase price).

3. How can a Deed of Sale protect you?

A Deed of Sale protects both the seller and the buyer. For the buyer the Deed of Sale serves as 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.

4. What information do you need to create the Deed of Sale?

To create your Deed of Sale you’ll need the following minimum information:

  1. The type of seller (e.g. individual or business) as well as name and details (e.g. nationality and address);
  2. The type of buyer (e.g. individual or business) as well as name and details (e.g. nationality and address);
  3. Brief description of the property subject of the sale; and
  4. Basic terms of the sale (e.g. purchase price, payment terms, warranties).

5. How much is the document?

The document costs PHP 400 for a one-time purchase. Once purchased you have unlimited use of the document.

You can also avail of Premium subscription at PHP 1,000 and get (a) unlimited use of our growing library of documents (from affidavits to contracts); and (b) unlimited use of our “Ask an Attorney” service which lets you consult a lawyer specializing in your concern.

Related Documents.

Activities that involve a Deed of Sale sometimes use the following documents. You may be interested in them:

Document Name