Understanding Agreement to Sell
An Agreement to Sell is a contract between buyer and seller outlining the terms of a future property sale. It records the mutual promise to buy and sell under agreed conditions before the final sale deed.
Essential Clauses
- ◆ Parties details and property description
- ◆ Sale consideration and earnest money
- ◆ Payment schedule
- ◆ Possession timeframe
- ◆ Title clearance condition
- ◆ Default clause
Frequently Asked Questions
What is Agreement to Sell?
Contract between buyer and seller outlining future property sale terms. Records mutual promise under agreed conditions.
Is registration mandatory?
Not mandatory. However if agreement includes delivery of possession registration required.
What if seller backs out?
Buyer can sue for specific performance. Court can compel seller to execute sale deed. Alternatively claim refund with damages.
What if buyer backs out?
Seller may forfeit earnest money as liquidated damages. Must prove actual loss to forfeit larger amounts.
What is role of earnest money?
Typically 5-10% of sale price. Forfeited if buyer defaults. Refunded with equal amount if seller defaults.
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