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Purchase and sale agreement, deed and property registration – What is the difference?

people make an agreement after the purchase and sale contract is signed.

The journey of buying a property involves several important documents such as purchase and sale agreement, deed, property registration.

With the decision to close a deal, some legal details – often unknown until then – knock on the door.

Most of us know or at least imagine, what a real estate deed is. But what is the purchase and sale contract for? What is the difference between deed and registration?

Let’s explain clearly and objectively the function and the moment of application of each one of them. It’s easier than it sounds and we’ll show you.

First step: purchase and sale agreement

It is the first instrument used to formalize the sale. It establishes rights and duties for both parties to the transaction and secures the sale of the property to the buyer.

But beware: the purchase and sale contract does not guarantee ownership of the property, only ownership. Therefore, it is important that the contract establishes the date of transfer of ownership and the conditions for the transfer of ownership.

Although it is not a rule, it is common to use the purchase and sale contract in cases of payment in installments and to transfer the deed and registration of the property as soon as it is paid off.

However, it is advisable that, even in cases of a cash purchase, a contract is made that ensures compliance with all the details agreed upon at the time of the transaction.

Closing of purchase and sale contract.

Contract closing. Source: Pinterest

In addition to the details of the buyer and seller, the contract must describe all the agreed financial conditions, as well as the value of the property, the method of payment and interest, in case of delay.

It must also include the description of the property negotiated with descriptive memorial, characteristics, dimensions and registration of the property with the city hall.

If the property is within a condominium, all urban restrictions for the location must be registered in the contract. When the property is purchased at the plant, the contract must also include the start and completion dates of the work.

How does the purchase and sale contract work?

The first step to prepare the purchase and sale contract is to write the document, after which it is necessary for both parties to analyze the document and make sure they are in agreement or not.

The preparation of this document must be done by a lawyer who has a good knowledge of this type of transaction so that there is no problem.

Carrying out the purchase and sale contract document with a lawyer. Carrying out the document with a lawyer.

The seller must take great care in drawing up this contract, as well as the buyer must carefully analyze the document before signing, to make sure that he is not agreeing with anything that is not his responsibility.

Finally, the seller and the buyer have to go to a registry office to sign and acknowledge the signature of the contract and, only after that, does the document take legal force.

How important is the purchase and sale contract?

The purchase and sale contract is a legal instrument that guarantees the completion of the sale since it will only happen with the passage of the property deed.

It is through it that you can be sure that what was agreed upon by both parties will be fulfilled, avoiding all kinds of complications that could arise.

If either party fails to comply with the obligations agreed upon in the contract, it is possible for the other party to file a lawsuit to be repaired for any inconvenience caused by the breach of obligations.

Documents required to prepare and sign the purchase and sale agreement

Most items are easily accessible, but some will require a greater effort to obtain. Below are the documents you will need to complete the contract.

Property documents

  • Certified copy of the deed in the seller’s name;
  • Tax clearance certificate, condominium debts;
  • Certified copy of the IPTU discharge for the year;
  • Property plan approved by the city;
  • Registration of the construction is registered in the real estate registry.

Seller Documents

  • Copy of RG and CPF;
  • If the marital status is married, the RG and CPF of the spouse and the certified marriage certificate are required;
  • Proof of address;
  • Clearance of civil actions, protests in the federal field and in the labor courts;
  • Clearance certificate of guardianship and interdiction.

Buyer’s Documents

  • Copy of RG and CPF;
  • If the marital status is married, the RG and CPF of the spouse and the certified marriage certificate are required;
  • Personal data such as address and profession.

Second step: public deed of the property

Public deed is the first step in transferring ownership. With all of their personal documents in hand (RG, CPF, birth certificate, marriage certificate, and proof of residence), the interested party must present the purchase and sale contract at a notary office, which must be drawn up by a notary.

At that time, the ITBI, Tax on Real Estate Transactions, is collected. Understand better how the ITBI calculation is done.

Thereafter, the contract is no longer private and the transaction becomes public, providing proof of the deal carried out.

This step is of paramount importance, as it creates a skillful title to the transfer of ownership of the property. However, only registration guarantees the definitive transfer of ownership.

The public deed is a document that validates the agreement made after signing the purchase and sale contract, but it does not guarantee that you are the owner of the property; what actually carries out the transfer of property ownership is the registration of the deed at the notary’s office.

What is the importance of the deed of purchase and sale of real estate?

The property purchase and sale deed, as the name implies, aims to validate the purchase and sale of a particular property; it is a document produced in the notary’s office.

Property Deed x Registration

Both are documents referring to the purchase of a property, but each of them has its particularities.

The deed is a public document that validates the agreement between the parties, whereas the registration is the document that individualizes the property, which contains information that is essential for legal identification, that is, it is the registration that contains the complete history of all the occurrences of the property.

Third step: property registration – the champagne can burst!

The deed, then, must be taken to the Real Estate Registry Office, which will be analyzed with the documentation required by a responsible professional. If everything is agreed, within 30 days after the protocol, the new owner will be registered in the property registration.

This property registration is what makes you the new buyer, it grants the buyer definitive ownership of the property. If the property registration is not done, you will only have possession and use of the property, but it will definitely not be yours.

Finally, with the registration in hand, the buyer will own the property and will be able to enjoy all its benefits.

How to get the General Property Registry

When you find your dream property, the first thing that comes to mind is to pack your bags and move, but be calm at this time. The first thing to do is register the property and for that there is a document called the General Property Registry (RGI).

What is the General Property Registry?

The General Property Registry (RGI) is a document that places the property in the buyer’s name, regardless of the way it was negotiated, both in cash and financed.

Ownership needs to be regularized and transferred to the name of the person responsible for it. The formalization makes all types of business involving the purchase and sale of real estate official.

How to get the RGI?

When you finish paying for your property, you will have to go to the Property Registry and ask them to place the property in your name, for

it is important to bring your RG, CPF and Marriage Certificate.

This service is paid and, depending on the value of the property, registration may not be so cheap. For proof that the property has been sold to the person who applied for registration, it is important to bring the deed or purchase contract.

How much does it cost to get the RGI?

Carrying out a document with a lawyer. Source: Pinterest

The amount of proof of payment of the Tax on the Transmission of Real Estate (ITBI) varies from city to city, in the case of the city of São Paulo, the price is 2% of the property’s market value.

The price is estimated by the Government in accordance with the Property Registration Data Certificate, that is, it is not the same amount paid for the property. Prices are available on your city’s City Hall website.

Once you have paid the proof of purchase and brought the documentation to the Real Estate Registry, you will have to pay another fee, the registration fee. In the same way that the ITBI is calculated, the registry value is calculated. It is possible to consult the table of values ​​that is provided by the Association of Notaries and Registrars of Brazil.

Now that you know all the details about the purchase and sale agreement, deed and property registration, you can buy your dream property without any worries, but always remember to consult a lawyer. At Apto, you will find several options for apartments to buy. Be sure to check it out!