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What is a Sale Deed and Why is it Important in Home Loans?

Nov 11, 2022
What is a Sale Deed and Why is it Important in Home Loans?

More than 50% Indians own their houses. The other part of the population is also constantly working towards owning their apartments, villas, and residential plots. For this, a home loan is one of the smartest solutions one can take up. Under one of the major documentations involved in the process of finalising the purchase of a home is a sale deed. This article covers the definition, advantages, and other intricacies of a sale deed in a home loan.

What is a Sale Deed?

When you buy a house from someone, you pay them, and they give you the ownership of the place. This transfer of ownership calls for a registration with the government that you are now the new, legally accepted owner. A sale deed is drafted and duly signed by the two parties involved.

The sale deed meaning is simple. It is an official, legal document in writing that declares the buyer’s name as the new owner of the property. It assigns all titles, rights, and responsibilities to the buyer. A property sale deed is critical proof of ownership, especially for banking and legal matters. Most importantly, you will need to produce a sale deed while applying for the home loan.

Benefits of a Sale Deed in Home Loans

This legal status of ownership sealed by a sale deed has numerous benefits to it. Here are the top 4:

Legal Proof of Title

In the case of any legal dispute, it is the sale of deeds for property that will stand in the favour of ownership transference. Hence, it empowers you to claim the property in context.

Clear Statement of Rights

This document clearly states all rights and rewards that come along with the home. Hence, you can defend your stance in case things go haywire.

Detailed Information About Home

A sale deed in a home loan accurately describes important details of the property in question, such as geographical location, pincode, area of plot, year of construction, etc., which are vital for home loan processing.

Proof of Transaction

A sale deed seals the home loan transfer from seller to buyer and confirms in writing that the amount is paid.

Documents Required for a Sale Deed

Without a sale deed, it is impossible to get a home loan. Check out the documents required for a sale deed:

  • Registered names, photographs, and PAN cards of the buyer and seller
  • Stamp duty fees (between 7-10% of market value)
  • General power of attorney
  • Building plan
  • NOCs (No objection certificate)
  • Receipts of payment and property tax
  • Possession finalisation letter
  • Certificates of encumbrance, occupancy, and completion

It will also be beneficial to check out all the documents required for a home loan along with the sale deed.

Things to Consider While Registering For Sale Deed

Before you sign the final contract and sale deed, keep in mind the following:

  • Never miss reading every single term, condition, and criteria on all documents that you sign. From the home loan application to sale deed, don’t overlook any written statement that affects your money or rights.
  • Be well informed about all the charges required to be paid. For instance, know the stamp duty fee imposed in your state and check with your lending institution if there are any additional charges to the home loan.
  • Always keep your original documents handy, but carry with you 2 photocopies of each too.
  • In every real estate transaction involving a sale deed, there is a witness required to be present at all times. Make sure that all steps are carried out in the presence of a reliable eye-witness.


Taking up a home loan to finally see your dreams come true is a major step in anybody’s life. Make sure you have all the documents in hand and cross-verify all essential terms and conditions, especially in the property sale deed. To make your process easier, Grihashakti comes with swift loan processing and reduced EMIs. Check out our home loan interest rates and use an online EMI calculator to understand how to structure your monthly budget around your home loan.

*Terms and Conditions apply. Loans are disbursed at the discretion of Fullerton Grihashakti.

Fullerton India Home Finance Company Ltd
CIN number: U65922TN2010PLC076972

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