What Is a Deed?
A deed is an instrument written, signed and handed over by one person, known as the grantor (seller), that transfers ownership of the real property to another person, known as the grantee (buyer). In other words, a deed is a signed legal document that grants the guarantee of certain rights over an object, allowing them to own it.
A deed is any written legal instrument that confirms and transfers an interest, right or property from one person to another. Simply speaking, a deed is a form of legal instrument that consists of a legally binding commitment to accomplish something. The most common application of deeds is to transfer property ownership: movable or immovable, between two parties.
The only significant difference between a deed and an agreement is that consideration is not required for a deed to be legally binding, and a deed must be executed in writing.
The five essentials of a legally valid deed are:
- It must be in writing.
- It must be signed.
- It must be expressed to be a deed.
- It must be witnessed by at least one such person who is not a party to the concerned deed.
- It must be delivered to the other party.
In India, some of the important types of deeds are:
Let us learn more about the kinds of deeds.
1. Sale Deed
A seller transfers ownership, title, and other property rights to a buyer in a sale deed. It is the most crucial document because it officially documents the proof for both the buyer and the seller. The buyer and seller must sign a sale deed before the property purchase or sale is legally completed. Both parties must be satisfied with the terms and conditions before a sale deed can be signed. Learn more about Sale under TPA.
2. Mortgage Deed
A mortgage deed is a legal instrument that provides all relevant information about the loan, such as the parties involved, the property held as collateral, the amount of loan taken, the interest rate, and so on. The deed explains everything there is to know about the property’s interest and title. It aids in the identification of the true owner of the mortgaged property. Learn What is Mortgage and Six Types of Mortgage.
3. Lease Deed
A lease deed is a legal document or instrument required for the performance of a lease. Essentially, it certifies the lessee’s ownership rights and interests in the leased property. Here is more about Lease under the Transfer of Property Act.
4. Gift Deed
A gift deed is a legal document that reflects the transfer of a gift. Under section 122 of the Transfer of Property Act, 1822, the donor can freely transfer an existing movable or immovable property to the donee through the use of a gift deed. It is legal only if given out of natural love and affection, without expecting anything in return, by a family member or friend to another family member/friend. Read more about Gift under TPA.
5. General Warranty Deed
For residential real estate sales, a general warranty deed is commonly utilised. The warranties conveyed and pledged, bind the seller or grantor legally. The grantor provides several covenants, sometimes known as warranties, for the title in a general warranty deed, promising that the title to the property is good and clear and that the property is free of any obligations and liabilities.
6. Special Warranty Deed
A special warranty deed does not provide the buyer with the same level of protection as a general warranty deed. The grantor or seller’s guarantee, which is offered to the buyer or grantee, does not cover the property throughout its history but just for the time when the grantor owned it. The grantor of this sort of deed only makes two warranties- first, that the grantor has title to the property. And second, that the property was free of encumbrances during the grantor’s ownership term.
7. Adoption Deed
Adoption is the process of establishing a parent-child bond between people who are not biologically related. The adoptive family bestows the adopted kid the rights, privileges, and responsibilities of a child and heir. It is a legal document in which all biological parents or parents’ rights & duties and filiation are transferred to adoptive parents. If interested, learn about the Rules of Adoption under Hindu Laws.
Info: Filiation means the fact of being the child of a particular parent or parents.
8. Quitclaim Deed
A quitclaim deed is typically executed when both parties have some form of relationship with one another, such as family members, divorced couples, and friends. It is generally performed by people who are familiar with one another. This type of deed is designed to transfer any title, claim, or interest in the property that the grantor may have, but it makes no assurances that such title is legally legitimate. So, in essence, this sort of deed provides for the straightforward transfer of property rights and claims to another party, with the majority of the time no money exchanged and no promise or guarantee.
9. Trust Deed
A trust deed is a type of transaction in which property is transferred to a trustee to secure a debt such as a promissory note or a mortgage. In the event of a default on duty, the trustee has the power to sell the property.
10. Court Order Deeds
These types of deeds are carried out without the owner’s agreement due to a court order. These deeds are created when the seller is unable to pay the price and are thus executed without their agreement. The exact price of the real estate is mentioned in advance as a consideration in these court order documents, which is a unique feature.
11. Fiduciary Deed
Info: Fiduciary means involving trust, especially with regard to the relationship between a trustee and a beneficiary.
When the grantor is a fiduciary, such as a trustee, this fiduciary deed is used to transfer property. This document simply guarantees that the fiduciary is functioning in the capacity and power that he has been given. When the owner cannot sign a deed for legal or other reasons, this type of deed is used to transfer property such as real estate. When the property’s original owner has passed away, fiduciary documents are frequently used to settle estates. When a fiduciary deed is utilised, it is given by a fiduciary, such as an executor, who has the authority to sign in the owner’s place.
12. Grant Deed
A grant deed is a legal document that transfers ownership of a property from the seller to the buyer in exchange for a set sum. It ensures that the seller has complete ownership of the property, the property being free and clear of all debts, but it does not include a warranty for title flaws, as the warranty deed does.
13. Conveyance Deed
A conveyance deed is a legal instrument that transfers ownership of property from one person to another as a gift, an exchange, a lease, or a mortgage, among other things. A conveyance deed can also be referred to as a gift deed, mortgage deed, lease deed, or sale deed. In its broadest sense, this refers to any property ownership transfer for the buyer’s benefit, such as a gift, mortgage, lease, or exchange. A sale deed is a legal document used to transfer ownership of a property through a sale. All conveyance deeds are all sale deeds, but not all sale deeds are conveyance deeds.
14. Deed of Power of Attorney
A deed of power of attorney is a legal document by which the principal grants his agent certain powers to conduct and execute certain actions or deeds on his behalf.
Extra Reading: Difference between a Lawyer, Advocate, Barrister and Attorney.
15. Relinquishment Deed
A relinquishment deed is a legal document unveiling a legal heir’s rights, titles, and interests in favour of others.
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