The importance of documentation in real estate cannot be over emphasised. It is important to note that 75 – 80% of real estate business is legal and these legal transactions cannot be void of documentations. Before any real estate transaction can be said to be successfully concluded, all documents have to be up-to-date and duly signed by relevant parties. Therefore to become a successful Realtor the understanding of land documentation is not negotiable.
It is important that as an investor in real estate or as a real estate firm you should know what governs land ownership and the legal documents used in conveying title for land ownership in the state, where your business is located or where you intend to invest in.
Importance of Documentation in Real Estate
- Title documents when verified give the buyer confidence to use the land without fear.
- Title documents that have been verified are legal documents that are admissible in a court of law in the event of any dispute that may arise in future.
- Title documents also serve as a form of collateral which an individual can use to access loans from financial institutions.
- For the real estate marketing firm, having all necessary title documents gives the firm the edge over their competitors as prospective buyers have confidence in your property listings. It creates a trust level between you and your client.
- Documentation plays a pivotal role in ensuring that the real estate firm keeps track of its progress and list of clients, take note of flaws if any, in previous transactions and enable the firm measure its sales progress by the years.
Let’s take a cursory look at some documents you have to know and understand in the Real Estate industry.
- SURVEY PLAN
A Survey plan is a document that measures the boundary of a parcel of land to give an accurate measurement and description of that land. The people that handle survey issues are Surveyors and they are regulated by the office of the Surveyor general in Lagos as it relates to survey issues in Lagos. A survey plan must contain the following information:
i. The name of the owner of the land surveyed
ii. The Address or description of the land surveyed
iii. The size of the land surveyed
iv. The drawn out portion of the land survey and mapped out on the survey plan document
v. The beacon numbers
vi. The surveyor who drew up the survey plan and the date it was drawn up
vii. A stamp showing the land is either free from Government acquisition or not
- DEED OF ASSIGNMENT
A Deed of Assignment is an Agreement between the Seller of a Land or Property and a Buyer of that Land or property showing evidence that the Seller has transferred all his rights, his title, his interest and ownership of that land to that the Seller that has just bought land.
The Deed of Assignment has been exchanged between both parties, it has to be recorded in the land registry to show legal proof that the land has exchanged hands and the public should be aware of the transaction. Such recorded Deed of Assignment come in the form of either a Governor’s Consent or Registered Conveyance
It is important to Note that the deed of assignment document is not the only document indicating transfer of owner.
The following documents are usually involved when a purchase is made.
- The purchase receipt
- The contract of sale
- The deed of assignment
- The survey plan
- The Building plan for housing investment.
- Any other title document that may apply
Each of these documents can come at separate times in the transaction process. The seller signs all documents when the transaction is complete and hands over the documents to the buyer.
Land Use Decree on the 28th of March, 1978 that vested all lands in every state of the Federation under the control of the State Governors. The Land Use Act coupled with other laws made it possible for the Governor who was now the owner of all lands in the state to actually have the power to Acquire more lands compulsorily for its own public purpose to provide amenities for the greater good of the citizens.
Fortunately, the government recognizes that indigenes of different sections of the country have a right to existence . . . a right to the land of their birth. Hence, it is customary for state government to cede a portion of land to the original owners (natives) of each area.
An Excision means basically taking a part from a whole and that part that has been excised, will be recorded and documented in the official government gazette of that state. In other words, not having an excision means the land could be seized by the Government anytime without compensating you even if you bought it “Legitimately” from the Baale or the Original dwellers on the land.
We shall continue with more documents you need to get acquainted with especially in Nigeria in our next post.