Builder-Buyer Agreement in India: What to Check Before You Sign
You have paid a booking amount, the project looks right, and the builder's office now hands you a long document to sign. That document, the builder-buyer agreement, decides what you pay and when, which area you are actually buying, when you should get the keys, and what happens if either side slips.
This guide is for buyers of under-construction homes, especially first-time buyers in Jaipur and Nagpur. It explains what the agreement is under RERA, what it must contain, which clauses deserve a slow second read, and how to compare your draft against what the builder has already filed with the regulator.
The Short Answer
Under RERA, what buyers call a builder-buyer agreement is legally the agreement for sale. Official fact: a promoter cannot accept more than 10% of the cost of a flat as an advance or application fee unless a written agreement for sale has first been signed and registered (RERA Act, Section 13(1)).
Before you sign, confirm five things:
The project is registered with the state RERA, and you have noted the registration number.
The draft follows the format your state prescribes and matches the proforma the builder filed at registration.
Carpet area, price and payment stages are written clearly.
The possession date and delay interest are stated, with the same rate applying to both sides.
Parking, amenities, defect liability and cancellation terms are in the document, not only in the brochure.
What is a Builder-Buyer Agreement, and How is it Different from Other Property Documents?
A builder-buyer agreement is the written contract between a promoter (the builder or developer) and an allottee (the buyer). It fixes the unit, price, payment schedule, possession date and each side's obligations until the home is conveyed to the buyer. The RERA Act defines an "agreement for sale" simply as an agreement entered into between the promoter and the allottee (Section 2(c)).
Buyers often mix it up with the documents on either side of it:
Document
What it does
When you meet it
Booking form or allotment letter
Reserves a unit and records basic terms and the token amount
Before the agreement
Agreement for sale (builder-buyer agreement)
The binding contract for an under-construction purchase; must be written and registered
Before you pay more than 10%
Conveyance (sale) deed
Transfers title to you; the promoter must execute and register it after the occupancy certificate
At or after completion
What this means for buyers: a token receipt is a step towards the agreement, not a substitute for it. If your payments are running ahead of your paperwork, pause.
Why Does the 10% Rule Matter More Than It Looks?
Section 13(1) puts a ceiling on how much a promoter can collect before the contract is in place. The logic is simple: until the agreement is signed and registered, you have paid money without a document that sets out the delivery date, the specifications or your exit terms.
An illustration (the figures are assumed, not market data): on a flat priced at ₹60 lakh, 10% is ₹6 lakh. Anything demanded beyond that, however it is labelled (booking, expression of interest, "allotment confirmation"), is a signal to ask for the registered agreement first.
Practical steps:
Keep every receipt and ask that each one states what the payment is for.
If more than 10% is requested, ask for the agreement draft before paying.
Plan your funds for the registration stage, because the agreement has to be stamped and registered. Stamp duty and registration charges differ by state and change over time, so confirm the current amounts with the sub-registrar's office (Rajasthan registration and stamps department for Jaipur; the Maharashtra registration department, IGR, for Nagpur).
Which Format Must the Agreement Follow in Jaipur and Nagpur?
Section 13(2) says the agreement must be in the form prescribed by the state. It must also set out the development particulars (construction, specifications, internal and external development works), the dates and manner of payments, the possession date, and the interest payable by each side on default.
Each state notifies its own format, so the answer differs by city.
Nagpur (Maharashtra). Maharashtra's RERA rules include a model agreement for sale (Annexure A to Rule 10). According to a legal analysis by S&R Associates, MahaRERA Order No. 38/2022 treats some clauses as non-negotiable: how the final carpet area is confirmed and the price adjusted (with a variation capped at 3%), and when a promoter may terminate after missed instalments (three defaults, 15 days' written notice, refund within 30 days). Other clauses, such as force majeure, formation of the allottees' association, conveyance and the five-year defect liability, may be worded differently but any change must be highlighted in a deviation report filed at registration. MahaRERA has also required fixed details on parking (number, type, size and location, with the approved parking layout attached), details of common areas with proposed handover dates, and the brokerage payable where a registered agent is involved.
Jaipur (Rajasthan). The Rajasthan RERA rules prescribe their own agreement format, referred to as Form G [VERIFY]. Promoters file their proforma of the allotment letter and agreement for sale when they register a project with RERA Rajasthan.
A Check Most Buyers Skip: Compare Your Draft with the Filed Proforma
The Act requires a promoter to submit the proforma of the allotment letter, agreement for sale and conveyance deed along with the registration application (Section 4(2)(g)), and to publish project details on the regulator's website (Section 11(1)). In Maharashtra, the agreement along with the deviation report is meant to be uploaded so that buyers can make an informed decision.
HomeVerse analysis: open the project's page on the state RERA website, read the filed proforma, and compare it line by line with the draft you were handed. A clause that appears in your draft but not in the filed version, or a protection that has disappeared, is a question to put to the builder before you sign.
Clause by Clause: What Should You Check Before Signing?
Clause
What the law or rules say
What to look for in your draft
Unit and carpet area
Carpet area is the net usable floor area, excluding external walls, service shafts, exclusive balcony or verandah and exclusive open terrace, but including internal partition walls (Section 2(k))
Area stated as carpet area, with balcony and terrace shown separately; any gap from the brochure explained. In Maharashtra, check how the final area is confirmed at completion
Price and payment schedule
Dates and manner of payments must be specified (Section 13(2))
Instalments tied to construction stages; clear list of what is and is not included in the price
Possession date
The possession date must be specified (Section 13(2))
A specific date, not "approximately"; how handover is defined; reference to the occupancy certificate
Delay interest
The rate is set by state rules; the promoter's rate to the allottee equals the allottee's rate to the promoter (Section 2(za))
The same rate on both sides; no harsher rate for buyer delays
Changes to plans
Changes to your unit's agreed plans, specifications or fittings need your consent, apart from minor changes; other changes to sanctioned plans or common areas need written consent of at least two-thirds of allottees (Section 14(2))
No blanket right for the builder to alter plans or amenities
Defect liability
Defects in workmanship, quality or services reported within five years of possession must be fixed free of charge within 30 days (Section 14(3))
Five years and 30 days, not a shorter period
Cancellation
The promoter may cancel only as the agreement provides; a buyer can approach the Authority if cancellation is unilateral and without sufficient cause (Section 11(5))
Notice period, time to cure a default, and refund timeline
Existing charges
After the agreement for sale, the promoter cannot mortgage or create a charge on your unit (Section 11(4)(h))
Disclosure of any existing mortgage or charge on the land or project
Association and conveyance
Where local law is silent, the association of allottees is to be formed within three months of a majority booking, and the conveyance deed executed within three months of the occupancy certificate (Sections 11(4)(e) and 17)
Stated timelines for both
Parking and amenities
In Maharashtra, parking and common-area details, including handover dates, must be specified. Elsewhere, the state format and project page apply
What this means for buyers: a promise made in a brochure or by a sales executive carries weight only if it appears in the agreement or its annexures. The Act does provide for compensation where a buyer pays on the basis of an incorrect or false statement in an advertisement or prospectus (Section 12), but a clear clause is a far simpler position to be in.
What Happens if Possession is Delayed?
Section 18 gives you two routes when the promoter fails to deliver by the date in the agreement:
Stay in the project: you are entitled to interest for every month of delay until possession is handed over, at the rate prescribed by the state rules.
Withdraw: you can ask for a refund of the amount paid, with interest and compensation as provided under the Act.
In Maharashtra, the prescribed rate is SBI's highest marginal cost of funds based lending rate (MCLR) plus 2% a year. Check the figure applicable on the date of any claim. For Jaipur, check the rate prescribed under the Rajasthan RERA rules and confirm that your agreement does not set a lower rate for the promoter than for you.
A simple illustration with an assumed rate (not a current rate): if you have paid ₹40 lakh and the delay is six months, interest at an assumed 10% a year would be ₹40,00,000 × 10% × 6/12 = ₹2,00,000. Your actual figure depends on the rate and dates applicable to your project.
Two cautions:
Your side of the bargain. You must make payments as the agreement specifies (Section 19(6)), pay interest at the prescribed rate if you delay (Section 19(7)), and take possession within two months of the occupancy certificate (Section 19(10)).
Force majeure. The Act describes it as war, flood, drought, fire, cyclone, earthquake or another calamity caused by nature affecting regular development (Section 6). HomeVerse analysis: read the force majeure clause in your draft and check that it has not been stretched to cover ordinary delays such as contractor or funding problems.
If a dispute arises, a complaint can be filed with the Authority or the adjudicating officer (Section 31), and compensation under Sections 12, 14, 18 and 19 is decided by the adjudicating officer (Section 71).
Local Checks: Jaipur and Nagpur
The agreement is only as reliable as the project behind it. Use the regulators that apply to your city and do not mix them.
Jaipur
Confirm the project's registration on RERA Rajasthan and note the registration number in the agreement.
Check which authority sanctioned the layout or building plan (Jaipur Development Authority or another competent authority) and that the approval details are written into the agreement.
Where the land parcel matters, cross-check land records on Rajasthan's land-record portal, Apna Khata, as part of your title checks.
Register the agreement at the sub-registrar office with jurisdiction over the property.
Nagpur
Confirm the project's registration on MahaRERA and read the filed agreement and deviation report.
Identify whether the land falls under the Nagpur Metropolitan Region Development Authority (NMRDA) or an older Nagpur Improvement Trust (NIT) layout, and check that the sanction named in the agreement matches the authority's records.
Register the agreement through Maharashtra's registration department (IGR).
Common Mistakes Buyers Make
Paying beyond 10% on the strength of an "expression of interest" or similar receipt.
Reading the main agreement but not the annexures, where specifications, payment stages and amenity details often sit.
Assuming the brochure and the agreement say the same thing.
Not comparing the draft with the proforma filed on the RERA project page.
Accepting a possession date with no definition of handover.
Leaving loan paperwork until after signing.
A Pre-Signing Checklist
Note the RERA registration number and open the project page on the state RERA website.
Download the filed proforma and compare it with your draft.
Confirm the sanctioning authority and approval details are written into the agreement.
Check carpet area, balcony and terrace areas, and the total price.
Match every payment instalment to a construction stage.
Check possession date, delay interest on both sides, and force majeure wording.
Check defect liability (five years, 30 days), cancellation and refund terms.
Check parking and amenities against the sanctioned plans.
Ask a qualified property lawyer to review the draft before you sign.
Keep stamped, registered copies and all payment receipts together.
Different claims need different proof. A quick guide:
What the listing or sales team says
What official records establish
What you should verify yourself
"RERA registered"
The registration number and project page on the state RERA website
That the number, promoter name and project details match your documents
"All approvals in place"
Sanctioned plans and approvals on file with the competent authority
That the approval names and dates in the agreement match those records
"Possession in 2028"
The completion date declared at registration
That the agreement states the same date, with delay interest
"Spacious 2 BHK"
The carpet area filed with the regulator
That the carpet area in the agreement matches the filed figure
How Does the Agreement Connect with Your Home Loan?
Lenders commonly ask for the agreement for sale when assessing a loan for an under-construction home, so it helps to have the draft reviewed before you sign rather than after. Offers from multiple banks and housing finance companies can help buyers compare financing options before committing. Loan eligibility and approval depend on the lender's assessment, so plan your finances without assuming either.
How HomeVerse Can Help
HomeVerse helps buyers in Jaipur and Nagpur explore homes, compare options and get guidance through the home-buying journey. It connects buyers with local partners who understand each city, and supports documents and financing steps. Buyers can explore and connect with HomeVerse without paying to search.
Frequently Asked Questions
Is a builder-buyer agreement the same as an agreement for sale?
In substance, yes. The RERA Act uses the term "agreement for sale" for the contract between the promoter and the buyer. "Builder-buyer agreement" is the everyday name for it.
Can a builder take more than 10% before the agreement is registered?
No. Section 13(1) bars a promoter from accepting more than 10% of the cost as an advance or application fee without first entering into a written agreement for sale and registering it. If more is requested, ask for the registered agreement first.
Does the agreement have to be registered?
Section 13(1) requires the written agreement for sale to be registered. Stamp duty and registration charges depend on the state, so confirm the current amounts with the sub-registrar's office before you budget.
What can I do if the builder delays possession?
Under Section 18, you can stay in the project and claim interest for every month of delay, or withdraw and seek a refund with interest and compensation. The rate comes from your state's RERA rules. Complaints go to the Authority or the adjudicating officer.
How long is the defect liability period?
Five years from the date of handing over possession. Defects in workmanship, quality or services brought to the promoter's notice within that period must be rectified free of charge within 30 days (Section 14(3)).
Can I ask the builder to change clauses in the agreement?
The agreement must follow the form prescribed by the state (Section 13(2)). In Maharashtra, MahaRERA has fixed some clauses as non-negotiable and requires other deviations from the model to be disclosed, and clauses contrary to the Act or rules are treated as unenforceable against the buyer. You can ask for clarifications and for specifics to be written into annexures. Verify what your state's rules allow before relying on any verbal assurance.
Conclusion
A builder-buyer agreement is where a purchase either becomes clear or stays vague. Check the project on the RERA website, compare your draft with the filed proforma, read the carpet area, payment, possession, interest, defect liability and cancellation clauses against the Act, and have the document reviewed by a qualified professional before you sign. These steps cost little time compared with the amounts involved.
This article is for general information and does not constitute legal, financial or investment advice. Rules, rates and market conditions change. Please verify details with the relevant authority or a qualified professional before making a decision.
Official portals to consult for your project: RERA Rajasthan, MahaRERA, Rajasthan registration and stamps department, Maharashtra registration department (IGR), Jaipur Development Authority, NMRDA and Nagpur Improvement Trust.
