It’s very important for every real estate investor or home buyer to know this;
- Are you planning to acquire a piece of property? Land or building?
- Have you bought a property and later lost it to another person, institution or government?
- Would you love to eliminate the risk of losing your hard earned money to dubious land and property sellers?
My mentor once told me never to invest in anything I don’t understand.
Smart investors investigate every investment opportunity (be it stock or real estate) to make sure it’s a safe deal before putting their hard earned money down.
Understanding land titles and documents is the first thing every aspiring real estate investor or home buyer who value their sweat and money do before venturing into any real estate deal.
THE LAND USE ACT OF 1978
“An Act to Vest all Land compromised in the territory of each State (except land vested in the Federal government or its agencies) solely in the Governor of the State , who would hold such Land in trust for the people and would henceforth be responsible for allocation of land in all urban areas to individuals resident in the State and to organisations for residential, agriculture, commercial and other purposes while similar powers will with respect to non-urban areas are conferred on Local Governments“
This law became effective on 27th March 1978 unto this day.
Before we delve into land title and documentations proper, it’s important we understand land classification.
LAND CLASSIFICATIONS (HOW LAND IS CLASSIFIED IN NIGERIA)
Land can be classified as either free or acquired. A parcel of land is considered free if the government has not indicated any interest whatsoever in that land. Such land is safe to buy because the title on the land can be obtained from the government without issues.
All lands that fall within areas that are designated as “urban areas‟ are under government acquisition until deemed committed or free (e.g Victoria Island, Ikoy,i ikeja and other major cities and towns across Nigeria etc).
1 There are two basic types of acquisition:
1. Committed Acquisition
2. Global Or General Acquisition.
1. COMMITTED AQUISITION
A parcel of land is said to be under committed acquisition when the government have indicated an intention to use that land for a specific purpose such as the provision of amenities.
Such lands belong to the government and can never be available for use by individuals.
If you purchase land that is under committed acquisition, it will be impossible for you to perfect your land title and you’ll only be occupying the land until the government decides it wants to make use of it.
This is usually the type of land fraudsters and fake agents portray to you as very cheap opportunity and you become a prey because you failed to carry out your due diligence.
2. GLOBAL OR GENERAL AQUISITION
Lands that are under “general acquisition” or “global acquisition” can later be confirmed “free” or “committed” as the case may be.
A land under general acquisition can become free by a process called excision.
“EXCISION is a process whereby the government releases a portion of an expanse of land that is not committed” If a parcel of land that was formerly under acquisition becomes excised; it is then considered free and becomes gazetted.”
A second case where lands under general acquisition can be released is if an individual purchased a land that was under acquisition without going through an excision process.
Such lands can go through another process called “ratification” or “regularization” in which the landowner pays for the land to be ratified or regularized.
The only conditions, in this case, are that the land in question must not fall within a committed area and that the purpose for which the land was bought does not disrupt the original plan of the state’s government. Conditions for ratification may differ from state to state.
However the Deed of assignment, the registered survey document, the Gazette and Certificate of Occupancy remains the same across the federation of Nigeria.
DETAILED EXPLANATION OF LAND DOCUMENTS AND TITLES
DEED OF ASSIGNMENTS
A Deed of Assignment is a very important transactional document drawn up by a real estate attorney between the current title holder (signor) for a particular property and the new buyer (assignee).
In real property transactions, a deed of assignment also known as deed of property or deed of conveyance is a legal document that transfers right of ownership of a property from assignor (who can be addressed as seller) to assignee ( who is the buyer or new owner of the property).
The deed contains very pertinent information for a real estate transaction. It spells out the date when the ownership of the property was transferred from one owner to the other.
It also gives a specific description of the property that is included in the transfer of ownership.
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.
A survey plan must contain the following information:
1. The name of the owner of the land surveyed
2. The Address or description of the land surveyed
3. The size of the land surveyed
4. The drawn-out portion of the land survey and mapped out on the survey plan document
5. The beacon numbers
6. The surveyor who drew up the survey plan and the date it was drawn up
7. A stamp showing the land is either free from Government acquisition or not
An Excision means basically taking a part from a whole and the 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 or the Original dwellers on the land.
A Gazette is an Official record book where all special government details are spelt out, detailed and recorded.
A Gazette will show the communities or villages that have been granted excision and the number of acres or hectares of land that the government has given to them.
It is within those excised acres or hectares that the traditional family is entitled to sell its lands to the public and not anything outside those hectares of land given or excised to them.
A Gazette is a very powerful instrument the community owns and can replace a “Certificate of Occupancy” to grant title to the Villagers.
A community owning a Gazette can only sell lands to an individual within those lands that have been excised to them.
The community or family head of that land have the right to sign your documents for you if you purchase lands within those excised acres or hectares of land.
If the government based on some reasons best known to them decides to revoke or acquire your land (when it is located within a gazetted area), you will be entitled to compensation.
The best way to know whether a land is under acquisition or falls within an excised/gazetted is to get the land coordinates, and take it to the surveyor general office for verification. Land Coordinates are obtained through survey
CERTIFICATE OF OCCUPANCY
A Certificate of Occupancy, also known as the C of O is a document issued by state governments in Nigeria to landowners and property buyers as a legitimate proof of ownership.
This document also spells out what the land can be used for; residential, commercial or mixed development. The C of O have a renewable life span of 99 years.
If the owner of a land with C of O wants to resell his land, the new buyer would need to seek the consent of the government to perfect his right of ownership.
Governors consent can only be obtained on the resell of a land with C of O since C of O can’t be obtained twice. However Governors consent can be obtained each time a property is sold to a new owner.
DEED OF MORTGAGE
It is a security for a loan with an undertaken for repayment and cesser upon recovery. The common types of mortgage transactions are; Equitable Mortgage and Legal Mortgage
Legal mortgage is a type of mortgage which transfers the legal right one has in the property, whether leasehold or freehold in consideration for loan advancement while Equitable Mortgage transfers just an equitable interest in the property to the mortgage.
A deed of assignment is the vehicle that transfers the titles (which is the right of ownership) from seller to buyer. Therefore the importance of deed in any transaction can never be over emphasized.
If you ever payed for a piece of land, and never got a deed, it’s advised you hasten up and get your deed because it’s your first prove of ownership that is recognized by law.
If you have no deed, It’s important you understand you have no land because losing your land to land grabbers would be as easy as ABC.
YOU NEED AN EXPERT!
You need an expert to help you secure and maintain fastest returns on all your real estate investments. Please, endeavor to abstain from omo onile wahala. Buy your properties from reputable real estate companies in Nigeria.
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