What is a Deed of Sale and a Deed of Absolute Sale in Real Estate? – Helpful Guide – 2023

Deed of Absolute Sale

A deed of absolute sale is a legal document that is used to transfer ownership of real estate from a seller to a buyer. It is a written contract that includes the names of the parties involved, a description of the property being sold, the purchase price, and any other terms and conditions that apply to the sale. The document generally includes a detailed legal description of the property, is typically signed by both the buyer and the seller, and is notarized by a public notary.

The Deed of Absolute Sale is a very important document, as it serves as the official record of the transfer of ownership. It is also used to update the property records and transfer the property taxes. It is also used as a proof of ownership to the new owner.

It’s important to note that a Deed of Absolute Sale is different from a Deed of Sale with Right to Repurchase, in which the seller retains the right to buy back the property within a certain period of time.

It’s also important to check the property’s title, whether it is clear or not, before purchasing or signing a Deed of Absolute Sale, as any encumbrances or liens on the property can affect the ownership transfer.

Difference between Deed of Absolute sale and Deed of sale

A Deed of Absolute Sale and a Deed of Sale are both legal documents used to transfer ownership of real estate, but there is a key difference between the two.

A Deed of Absolute Sale is a legal document that transfers full and complete ownership of a piece of property from the seller to the buyer, with no strings attached. Once the Deed of Absolute Sale is signed and executed, the property is transferred to the new owner, and the previous owner no longer has any claim to it.

On the other hand, is a legal document that transfers ownership of a piece of property from the seller to the buyer, but with certain conditions or contingencies that must be met before the sale is considered final. The most common type of Deed of Sale is a “Deed of Sale with Right to Repurchase,” in which the seller retains the right to buy back the property within a certain period of time.

In summary, a Deed of Absolute Sale transfers ownership of the property completely and permanently to the buyer, while a Deed of Sale transfers ownership but with certain conditions or contingencies that must be met before the sale is considered final.

There are several advantages to having a Deed of Sale, which include:

1. Legal proof of ownership: A Deed of Sale serves as legal proof of ownership of a piece of property, and can be used to update the property records and transfer property taxes.
2. Clear title: It is typically used when a clear title to the property cannot be obtained, and it is a way for the parties to transfer ownership even if there are liens or encumbrances on the property.
3. Flexibility: Can be customized to include specific terms and conditions that suit the needs of the buyer and the seller.
4. Protection for both parties: A Deed of Sale can protect the interests of both parties by including warranties and representations by the seller, such as the property is free from liens, mortgages, and encumbrances, and by including contingencies for the buyer, such as the completion of certain repairs or improvements to the property before the sale is considered final.
5. Right to repurchase: A Deed of Sale with the Right to Repurchase allows the seller to reclaim the property back by paying the agreed amount to the buyer, within a certain period of time. This type of Deed of Sale is sometimes used when the seller is in financial difficulties and needs to raise cash quickly, but wants the option to buy back the property in the future.

There are several advantages to having a Deed of Absolute Sale, which include:

1. Clear and complete ownership: The Sale transfers full and complete ownership of a piece of property from the seller to the buyer, with no strings attached. This means that once the Deed of Absolute Sale is signed and executed, the property is transferred to the new owner, and the previous owner no longer has any claim to it.
2. Legal proof of ownership: The Sale serves as legal proof of ownership of a piece of property and can be used to update the property records and transfer property taxes.
3. Simplicity: A Deed of Absolute Sale is a simple and straightforward legal document that transfers ownership of the property without any contingencies or conditions that must be met before the sale is considered final.
4. Certainty and Clarity: A Deed of Absolute Sale provides certainty and clarity as it is a final document, and it is clear that the seller no longer has any right or interest in the property.
5. No right to repurchase: A Deed of Absolute Sale doesn’t have any provisions for the seller to repurchase the property, this makes it a final transfer of ownership.
6. Flexibility: A Deed of Absolute Sale can be customized to include specific terms and conditions that suit the needs of the buyer and the seller, such as warranties and representations by the seller, and contingencies for the buyer.

Content of Deed of Sale

A Deed of Absolute Sale typically includes the following information:

1. Names of the parties involved: The full names of the seller(s) and the buyer(s) should be included in the document.
2. Description of the property: The document should include a detailed legal description of the property, including the street address, lot and block number, and any other identifying information.
3. Purchase price: The document should specify the purchase price for the property, as well as any other terms of the sale, such as financing or contingencies.
4. Signatures: The document should be signed by both the buyer and the seller, and notarized by a public notary.
5. Date of the sale: The date of the sale should be included in the document.
6. Warranty and representations: The document should include representations and warranties made by the seller, such as the property is free from liens, mortgages, and encumbrances, or that the property is in good condition.
7. Notice of rights and obligations: The document should include any notice of rights and obligations that the buyer or the seller may have, such as taxes and insurance.
8. Special instructions: The document may include any special instructions, such as the transfer of utilities, or any other matter that the parties have agreed upon.

When you purchase a property like the Lladro House in Camella Homes you will get the Deed of Absolute sale once the whole amount will be paid in full.

Or When plan to buy a pre-selling condo property like in Costa Mira Beachtown Panglao located in Dauis Panglao Bohol or a house and lot in Tierra Alta San Fernando Cebu you will get the Deed once it will be turned over to you and the whole amount will be paid in full.

Please note that the above information is for general guidance only, and the content of a Deed of Absolute Sale may vary depending on the jurisdiction and the specific circumstances of the sale. It’s important to consult with a legal professional to ensure that the document meets all legal requirements and protects the interests of both parties.