Importance of a Sales Agreement When Buying Land

Importance of a Sales Agreement When Buying Land

Sales Agreement for Land

A Sales Agreement is a legal document that lays out the terms and conditions of a transaction. It is also called a Sale and Purchase Agreement and generally covers the sale of goods rather than services which in this instance is Land. It is also defined as a legal document that defines the terms of a real estate transaction.

It is used to protect the interests of both the vender and the purchaser (buyer and seller). This document enables the process of sale to go on smoothly. Terms and conditions on the sales agreement must be understood by both parties (buyer and seller) and followed until the time the sale deed is made.

Section 3 (3) of the law of Contracts Acts (Kenya) states that any transaction relating to land;

  • Must be in writing and signed by both parties; buyer and seller.
  • Must be witnessed and attested by an Advocate of the High Court of Kenya.
  • Must specify the land registration number, size of the plot, its location and amount to be paid for it.
  • Must indicate how payments will be processed for example installment X for Y period of time or whether it is cash payments.
  • Must be registered at the Lands Registry.

Also, it is important to make sure that as a buyer, you have done your due diligence so as to avoid falling into the hands of fraudsters and conmen. Make sure the seller has the right to sell the property, meaning; he or she must be the true owner of the land and it should be registered under his/her name.

To avoid being scammed, request for the following copies from the seller so as you may perform a search of the land at the Land Registry;

  • National ID
  • KRA Pin
  • Certificate and Title deed

This will inform you on whether the Title deed is genuine, size and registration number of the plot and the registered owner.

Contents of a Sales Agreement

A sales agreement contains the following contents;

  1. Identity of both the buyer and the seller

This includes information like, their full names, ID numbers, KRA pins, Phone numbers and Physical Address.

  1. Purchasing Cost

Here, both parties will have to agree on the amount to be paid as cost of sales, method of payment; cash or installment and lastly the period and time to be paid.

  1. Property description

This is a spoken written account of the size of the plot, title number, location and condition of the land.

  1. Cost of Distribution

This explains who is to pay the different costs involved in the process like; stamp duty, legal fees and title transfer.

Note; Title transfer is transfer of land from seller to buyer.

  1. Each party’s obligation in the transaction

This part clearly outlines both the buyer’s and the seller’s role in the transaction process.

  1. Remedies of Breach of the Contract

It protects the interests of both parties in the agreement by stating how non-performance of the agreed terms of the agreement is to be handled.

Always request for the services of a lawyer or legal practitioner so as they may clarify the contents of the Sales Agreement for you in case you plan to do it all by yourself.

Denver Group Limited is among the best land selling companies in Kenya that offers value additions in all its plots and delivers ready title deeds to its customers. To invest with Denver Real Estate call; 0701 730 267