Signing a property agreement is one of the most important things you will ever do. Once you sign, you are legally bound to the terms on that document. If something is wrong — a clause you did not understand, a number that does not match what you were told, a penalty you did not know about — it becomes very difficult and expensive to fix after the fact.
The good news is that checking a property agreement thoroughly is not complicated. You do not need to be a lawyer to understand the key things that matter. You need to know what to look for, read each section carefully, and ask questions about anything that is unclear before you sign.
This guide gives you a clear, plain-language checklist. Use it for any property agreement — whether you are buying a new flat from a builder, a resale property from a previous owner, or a commercial space for your business.
| Quick Checklist — Before You Sign ✓ Seller/builder’s name and details match official records ✓ RERA registration number verified (for new projects) ✓ Property description matches what you were shown ✓ Carpet area is clearly stated (not just super built-up area) ✓ Total price and payment schedule are exact and complete ✓ Possession date is stated with a penalty clause for delay ✓ Penalty on buyer for delayed payment is reasonable and mutual ✓ Fixtures and amenities promised verbally are listed in writing ✓ Exit clause — what happens if you need to cancel ✓ Original title documents verified (for resale properties) |
Check 1: Who Is Selling — And Do They Have the Right to Sell
The first thing to verify is simple but critical: is the person selling you the property actually the legal owner, and do they have the right to sell it?
For a new project, confirm that the builder is the registered owner of the land on which the building is being constructed. Ask for the land title documents and, if possible, have a lawyer review them. A builder who is constructing on disputed or encumbered land cannot legally transfer ownership to you — even after you have paid in full. This situation is more common than most buyers expect.
For a resale property, ask to see the original sale deed from the last transaction. The seller’s name on that document must match the person you are negotiating with. If the property has changed hands multiple times, trace the ownership chain back at least 30 years. Each transaction should have a registered sale deed. Any gap in this chain — a missing document, an unregistered transfer — is a serious red flag that must be resolved before you sign anything.
If the property has a home loan on it (which many resale properties do), the seller must obtain a No Objection Certificate (NOC) from their bank before transferring the property to you. Without this NOC, the bank’s lien on the property remains, and you could end up responsible for a loan you did not take.
Check 2: Verify RERA Registration (For New Projects)
If you are buying a flat or villa in a new project, the project must be registered under RERA (Real Estate Regulatory Authority) — India’s real estate consumer protection law. This is not optional. Any builder offering residential units for sale without RERA registration is breaking the law.
You can verify RERA registration yourself in about two minutes. Go to your state’s official RERA website (for example, maharera.mahaonline.gov.in for Maharashtra, rera.karnataka.gov.in for Karnataka). Search for the project by name or the RERA registration number the builder has given you. The RERA website will show you the registered details of the project, the approved number of units, the current status of construction approvals, and any complaints filed against the builder.
A RERA-registered project gives you specific legal protections. The builder cannot change the approved building plan without your consent. The money you pay must be deposited in a designated escrow account and used only for that project. You have a right to a refund with interest if the builder delays possession beyond the committed date. These protections do not apply to non-RERA projects.
Check 3: Read the Payment Schedule Line by Line
The payment schedule in your agreement states exactly how much you must pay, and when. Read every line carefully and cross-check every figure. The total of all instalments must equal the total property price stated at the top of the agreement. If the numbers do not add up, stop and ask for clarification before signing.
Watch for these specific issues. First, construction-linked payment plans — where you pay as each floor of the building is completed — should state clear milestones. “On completion of slab” is a valid milestone. “On builder’s discretion” is not. Second, check when your maintenance deposit, parking payment, and any club membership fee are due. These are often listed separately and can add up to a significant amount that new buyers do not budget for. Third, if there is a demand for payment before OC (Occupancy Certificate) is obtained, be cautious. Many builders demand payment of the final instalment at the time of possession, but the OC confirms the building has been constructed legally and is fit for occupancy. Paying before OC is obtained is a risk.
Check 4: Possession Date and Delay Penalty
Your agreement must state a clear possession date — the date by which the builder promises to hand over your finished flat to you. It must also state a penalty the builder will pay you if they are late. Under RERA, the penalty for delay is interest on the amount paid, at the SBI MCLR rate plus 2%, for every month of delay. This penalty is your legal right — do not accept an agreement that does not include it.
Check also what the agreement says about force majeure — situations the builder claims are outside their control, like natural disasters or government policy changes. A reasonable force majeure clause is acceptable. An overly broad one that allows the builder to delay indefinitely due to vague reasons is not. If the force majeure clause seems very wide, flag it to your lawyer before signing.
Pay equal attention to the penalty on you for delayed payments. If you are late on a payment instalment, most agreements charge you interest — typically 12 to 18% per annum on the overdue amount. This is standard practice. But the agreement should impose a similar penalty on the builder for their delays — the penalties should be mutual and broadly comparable. An agreement that charges you 18% for a delayed payment but offers you nothing for a delayed possession is fundamentally unfair.
Check 5: Everything Promised Must Be Written Down
Whatever the salesperson or broker told you during the site visit — the view from the balcony, the flooring type, the branded fittings in the kitchen and bathroom, the car park allocation, the access to the swimming pool or gym — none of it means anything unless it is in writing in your agreement.
Verbal promises made during a sale are not legally enforceable. The builder can (and sometimes does) deliver something different from what was shown in the sample flat. Your agreement must contain a detailed specification sheet describing the materials, brands, and quality of everything included in your flat. If the salesperson made a specific promise — two car parks instead of one, a particular view, early possession — it must be in the agreement. If it is not, ask for it to be added in writing. If the builder refuses, treat that as important information about how they will conduct the relationship after your money is paid.
Sirf Broker POV: The 30 Minutes You Spend Reading This Agreement Could Save You Years of Dispute
We have worked with buyers who discovered the problems with their agreement after they signed. By then, their options were limited and expensive. The clauses that caused problems were not hidden — they were right there in the document, in readable language. But the buyers did not read them, or did not know what to look for, or were in a rush to close the deal before the “special price” expired.
Our position is direct: no legitimate builder or seller will refuse to give you time to read a property agreement carefully. If you are being pressured to sign immediately, with no time to read or get a second opinion, that pressure itself is a warning sign. Urgency is a sales tactic. A good property transaction is not made or lost in one afternoon.
Take the agreement home. Read it. Use this checklist. Have a lawyer review any clause you do not understand. Ask your broker to explain anything that is unclear. A broker who knows their business can walk you through every standard clause and flag the ones that are unusual or unfair. This is part of what you are paying them to do. The 30 minutes you spend before signing is the most valuable time in your entire home-buying journey.
Conclusion
A property agreement protects you — but only if you have read it. Use the checklist in this article every time, for every property, without exception. When in doubt, get a second opinion before signing anything.
For more on how to verify a property before you even get to the agreement stage, read our guide on property verification before a site visit, and check our article on common mistakes in property leasing deals.
Frequently Asked Questions
What is the most important thing to check in a property agreement in India?
The most important things are: (1) that the seller has legal title and the right to sell, (2) that the RERA registration number is valid and matches the project details on the official RERA website, (3) that the carpet area is clearly stated and matches what you were told, and (4) that the possession date is specific and includes a penalty clause for delay. These four things catch the majority of problems that come up in property disputes.
What is a sale agreement and is it the same as a sale deed?
No — they are different documents. A sale agreement (also called an agreement to sell) is a contract between the buyer and seller that records the agreed terms — price, payment schedule, possession date, and conditions — before the final transfer. A sale deed is the actual transfer document that legally moves ownership from seller to buyer, and must be registered at the Sub-Registrar’s office to be valid. The sale agreement comes first; the sale deed comes at the end of the transaction, usually at the time of possession or loan disbursement.
Can I cancel a property agreement after signing?
You can cancel, but the terms and costs depend on what the agreement says. Most agreements have a cancellation clause that specifies what happens if you withdraw — typically the builder retains a portion of the amount paid (often 10 to 20% of the total price) as cancellation charges. Under RERA, if the builder delays possession beyond the committed date, you have the right to cancel and claim a full refund with interest. Read the cancellation clause carefully before signing — it should be reasonable and clearly stated.
Do I need a lawyer to review a property agreement in India?
For large transactions, yes — getting a lawyer to review the agreement is strongly recommended. A property lawyer can identify unusual clauses, flag unenforceable terms, and advise you on your rights and risks. Their fee for reviewing an agreement is typically ₹5,000 to ₹20,000 depending on the complexity and the city — a small cost relative to the crore-plus transaction it protects. For smaller transactions, at minimum use a detailed checklist like this one and ensure your broker explains every major clause to you.
What is a NOC from a bank in a property transaction?
NOC stands for No Objection Certificate. If the seller of a resale property has an existing home loan on that property, their bank has a legal claim (called a lien) on the property. Before the seller can transfer ownership to you, they must repay their loan and obtain a NOC from their bank confirming the loan is cleared and the bank has no objection to the sale. Without this NOC, the bank’s lien survives the sale — meaning you could buy a property with an existing outstanding loan on it. Always ask for the NOC before you pay any significant amount.
What should be included in the specification sheet of a property agreement?
The specification sheet should describe: flooring material and brand for each area (bedrooms, living, kitchen, bathrooms), wall finish and paint brand, bathroom fixtures and fittings (brands specified), kitchen fittings (sink, taps), doors and windows (material and brand), electrical points and wiring standard, and any appliances included. Any verbal promise about fixtures — branded fittings shown in the sample flat, specific flooring quality, modular kitchen — must appear in this specification sheet. What is not written is not guaranteed.