Is Sale Deed Necessary for Home Loan?

Yes. Sale deed is necessary for home loan approval because it is the final document which confirms your ownership over a property. When you apply for a home loan, the lender or bank will do a thorough check also known as due diligence and it is to ensure that property you are purchasing is legal and all the documents are valid. A sale deed is an important document to showcase your final ownership over the property. So when someone asks me ‘Is sale deed necessary for home loan?’ I say yes, absolutely. Did you know? Most of the home loan applications are rejected because of the incomplete documentation. Home buyers must know that a sale agreement is not equivalent to a sale deed, hence this document should be present. Some of the other documents required to get approval on home loan are:

• Land extract records
• Title deed
• Property map
• Allotment letter
• GPA or General Power of Attorney
• Possession letter
• Encumbrance certificate
• Tax receipts
• NOC
• Occupancy certificate
• All the payment receipts

Now that you have the answer, I hope you will take the right documents with you while applying for a home loan. Before you head to get a sale deed drafted, you can also check your home loan eligibility on NoBroker, here,

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Yes, a loan against sale deed s possible. Here’s why:

1. Legal Ownership: A sale deed is a legal document that establishes the transfer of ownership from the seller (vendor) to the buyer (vendee). It provides evidence of ownership and title to the property.

2. Collateral for Loan: Lenders require collateral to secure home loans. The property being purchased serves as collateral. The sale deed proves your ownership, making it an essential document for loan approval.

3. Registration: A sale deed must be registered with the Sub-Registrar of Assurances. The registration process ensures the validity and enforceability of the transaction. Lenders verify the registered sale deed during loan processing.

4. Loan Disbursement: Before disbursing the loan amount, banks or financial institutions verify the property’s legal status. They review the sale deed to confirm that the property is free from encumbrances and has a clear title.

Remember that specific requirements may vary based on the lender and local regulations. Always consult with your bank or financial institution for precise details related to your home loan application.

Need help with property registration and document verification? Contact NoBroker Legal experts to get end to end assistance heree

Understanding all the paperwork and

property documents required for home loan

and disbursement of funds is crucial if you're preparing to use a housing loan to buy your dream house. The sale deed is one of the documents you must deliver to your loan provider. Throughout the period of repayment, the lender will have the initial sale deed for the property.

Get your sale deed drafted by opting for NoBroker’s legal services.

The most significant legal document used as proof in real estate transactions is a selling deed. It displays how ownership, rights, and possession of real estate are transferred from the seller to the buyer. The sale of the property is not deemed legally completed until both the seller and the buyer have signed the selling deed.

Both sides agree on the sale deed to give the transfer legal status after both the seller and the buyer are completely pleased with the conditions and circumstances of the transaction.

What is the importance of a sale deed for home loan?

Now that you are aware of what a sale document is, let's quickly discuss its significance in a mortgage.

If the buyer is financing the acquisition with a home loan, they must submit the executed and recorded sale deed to the lender. The borrower must give the lender a number of property-related documents, including the original selling deed, in order to start the loan disbursal process.

The selling deed will be retained by the lender until the debt has been fully repaid. The sale deed must be returned to the borrower by the lender within 15 days of the home loan is fully repaid, per the law.

Is a sale deed for home loan the same as an agreement of sale? 

There is a difference between a sale deed and a sale agreement or agreement of sale. A sale deed, as previously established, is a document that formally transfers rights of ownership from the seller to the purchaser.

An agreement of sale, on the other hand, is a document that outlines the conditions that the buyer and the seller have decided upon for the purchase of the real estate. All of the terms and conditions under which the estate will be sold or exchanged are laid forth in the document. The sale agreement, in a contrast to the sale deed, does not create or expand any rights or interests in a property for a buyer.

I hope I was able to explain to you the

property documents required for home loan.

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What is a Sale Deed? The sale deed, also known as a title deed, final deed, or conveyance deed, is a legal document by which the seller transfers his absolute ownership of the property to the buyer in exchange for a price paid or consideration. Therefore, to answer your query: is sale agreement mandatory for home loan? I would say that a sale deed is a mandatory legal document, accompanied by a proper registration process and stamp duty, for obtaining absolute rights in a property as it provides legal recognition of the transaction of property between the parties and becomes a valid proof of ownership of immovable properties. What Is The Difference Between Sales Agreement And Sales Registration Get your sale agreement drafted carefully by expert lawyers at NoBroker. Check out latest deals and offers here Is a Sale Deed necessary for a home loan? I will tell you the reason you might not get home loan without sale deed. Refer to the points below:

• Since, it is the final document which confirms your ownership over a property, thus it makes sale deed one of the important legal documents for home loan.
• To initiate loan disbursal, the borrower is required to submit a number of property-related documents to the lender, including the original sale deed.
• The lender holds on to the sale deed until the loan is fully repaid.
• According to the law, the lender is required to return the sale deed to the borrower within 15 days from when the home loan is fully repaid.

Read more: What is sale deed number What is sale deed registration

Of course, it is. 

Imagine someone asks you for Rs. 15000 and promises that he will give you a watch worth this much money to you. Would you not want the watch to be left with you until you get your money back?

It's the same scene here. The only difference is that in case of a home loan, things are legally binding and instead of a watch, you have to give your property papers to the bank as collateral. Let me explain in detail what is sale deed and is sale agreement mandatory for home loan or not.

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Ms. Punam has wonderfully explained the role of a sale deed in terms of home loan. It is the final document that confirms that the property transaction is complete and now you are the rightful owner legally as per the Revenue Department of your state. 

Is sale agreement mandatory for home loan?

Okay, I am including this part for you because there is a lot of confusion around whether a sale agreement is submitted in the bank or a sale deed. Well, let me tell you a sale agreement for a home loan is submitted in the bank when you are going to opt for a home loan against the property you intend to buy. In that case, you will have to submit a sale agreement. 

A sale deed is submitted at the final stage of home loan approval when the sale transaction has happened and you are the rightful owner of the property legally. 

Summary:

A home loan without sale deed is a far fetched dream. You cannot obtain a home loan without a sale deed. If someone offers you a home loan without it then probably the interest rates will be higher. 

I hope you are satisfied with my answer. 

Read more:

Is sale agreement required for home loan

What is sale deed registration

What is sale deed number