Step-by-Step Process for Agreement to Sale in India
Step 1: Property Due Diligence
Before drafting the agreement:
- Verify property title
- Check encumbrance certificate
- Ensure property approvals and completion certificate
- Confirm seller’s ownership rights
Step 2: Finalize Commercial Terms
Agree on:
- Sale price
- Token amount / advance payment
- Payment milestones
- Possession date
Step 3: Draft the Agreement to Sale
Draft a detailed agreement covering:
- Property description
- Payment terms
- Obligations of buyer & seller
- Default & cancellation terms
- Force majeure clause
Step 4: Pay Stamp Duty
- Stamp duty is payable as per state laws
- Stamp duty amount varies from state to state
Step 5: Execute the Agreement
- Agreement is signed by both parties
- Witnesses sign the agreement
- Digital execution may be allowed depending on state laws
Step 6: Register the Agreement (If Required)
- Mandatory in many states
- Registration done at Sub-Registrar Office
- Protects buyer’s interest
Step 7: Proceed to Sale Deed Execution
- On fulfillment of conditions
- Final Sale Deed executed and registered
- Ownership legally transferred
Documents Required for Agreement to Sale
- Identity proof of buyer & seller
- Property title documents
- Approved building plans
- Encumbrance certificate
- PAN cards
Benefits of Agreement to Sale
- Legal protection for both parties
- Transparency in transaction
- Clearly defined payment terms
- Reduces future disputes
- Enables loan processing
- Protects buyer’s rights before sale deed
Difference Between Agreement to Sale & Sale Deed
| Agreement to Sale | Sale Deed |
|---|---|
| Future transfer | Immediate transfer |
| Executory contract | Executed contract |
| Conditional | Absolute |
Common Mistakes to Avoid
- Not verifying property title
- Vague payment terms
- Improper stamping
- Skipping registration
- Using unverified templates
How Saving Mantra Helps
Saving Mantra offers end-to-end real estate legal support, including:
- Drafting Agreement to Sale
- Stamp duty & registration support
- Property due diligence
- Sale Deed drafting
- Legal advisory services
Frequently Asked Questions (FAQs)
Q1. Is Agreement to Sale legally binding in India?
Yes, it is legally enforceable if properly drafted and stamped.
Q2. Is registration of Agreement to Sale mandatory?
It depends on state laws, but registration is recommended.
Q3. Can an Agreement to Sale be cancelled?
Yes, as per cancellation clauses mentioned in the agreement.
Q4. Does Agreement to Sale transfer ownership?
No, ownership transfers only after Sale Deed registration.
Disclaimer
This article is for informational purposes only and does not constitute legal advice. Real estate laws, stamp duty, and registration requirements vary by state and are subject to change. For accurate and legally compliant documentation, consult Saving Mantra professionals.