A Seller’s Obligations & Rights Under The Transfer Of Property Act

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A Seller's Obligations & Rights Under The Transfer Of Property Act

Ateverystageofthepropertysellingprocess,asellerhasavarietyofrightsand obligations.Theseincludetheabilitytoimposeafeeifthebuyerbacksoutafter payingthetokensumandtheobligationtosettlealldebtspriortotheproperty transferprocess.Lookintothespecificobligationsandrightsofaseller!

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Thecontract,whichisdiscussedandsignedbybothparties,governstheobligations andrightsofaseller.(buyerandseller).Intheabsenceofsuchanagreement, Section55oftheTransferofPropertyAct,1882governstheobligationsandrights oftheseller.

Obligations of a seller before a property transaction

 Tomakeknowntoprospectivebuyersofthepropertyallsignificantflaws thattheymightnotbeawareoforbeunabletodetectinthenormalcourseof business.Amaterialdefectisaproblemwithapartorsystemofaresidential propertythatcouldnegativelyaffectthevalueofthepropertyinquestionor poseanunreasonablerisktotheoccupant,suchastemporarilyconcealed, seriousseepageproblems,ashakybuildingfoundation,etc.

 Toprovideallapplicabletitledocumentsthatareinyourpossession,or withinyourlegalrightstoaccessandpresent,tothebuyeruponrequest.

 Torespondto,tothebestofyourability,whateverquestionsthebuyerreally andappropriatelyasksaboutthepropertyoritstitle.

 Mustsignacontractwiththebuyerstipulatingthattheirstakeinthe propertywillstaytheirsafterthetransfer,despiteyourintentionstotransfer ittothem.Thebuyerwouldalsogaintherighttosellthepropertytowhoever theychose.

 Mustsettlealloutstandingdebtsonthepropertythathaveaccumulatedup untilthesellingdate,suchasanypropertytaxesorotherliens.

 Betweenthesigningofthepurchaseagreementandthetransferof possession,totakegoodcareoftherealestateandallpertinenttitlepapers.

After a property is sold, a seller has obligations.

 Totransferownershipofthepropertytothebuyeroranyotherpersonthe buyerdirectsafterthesaleiscomplete.

 Afterobtainingthefullsalepriceoftheproperty,tohandovertothebuyerall thetitledocumentsthatyouareinpossessionoforhaveaccessto.

Prior to the property sale, a seller's rights

Tobeabletocollecttherentandprofitfromtheproperty.

Rights of a seller following a property sale

Referstoachargeorlienonthepropertyinascenariowhereownershipofthe propertyistransferredtothebuyerbeforethesellerreceivesthecomplete purchaseprice.

Itmightbewisetoincludeapenaltyclauseinthe"SaleAgreement"youagreeinto withthebuyerinadditiontotheseobligationsandrightsofyours,whichareoften reflectedinit.Thisprovisionstatesthatanyearnestortokenmoney(often10%to 20%ofthetotalsalepriceoftheproperty)providedtoyoubythebuyerisnonrefundableintheeventthatthebuyerfailstopaythebalanceofthepurchaseprice toyouontimeorcancelsthetransaction.

Itwouldbewisetospendsometimelearningaboutyourobligationsandprivileges asasellersothatyouareawareofwhatisrequiredofyouandwhatyourrightsare throughoutthesellingprocess.

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