Real Estate Contracts 101: The Clauses You Don’t Want to Miss
- Rhea Verma
- 2 days ago
- 3 min read
If you’re buying, leasing, or investing in property — especially in India — the paperwork is everything.
People love to focus on the square footage, the price, the view. But none of that matters if your contract is weak. Or vague. Or written entirely to protect the other side.
And let’s be honest — most real estate agreements are full of boilerplate that no one reads. Until something goes wrong.
This isn’t a scare tactic. It’s just how property deals work here. And if you're not careful, it can cost you time, money, and a whole lot of peace of mind.
Here’s what actually needs to be in that agreement.
1. Start with the Basics — But Go Deeper
You’d be surprised how often this part is rushed.
The contract should clearly mention:
Exactly who’s involved (full names, IDs, PANs, etc.)
A real description of the property (with survey numbers, landmarks — not just “flat in XYZ Tower”)
Title details: who owns it, and if it’s already pledged or under litigation
If the seller can’t give you this upfront, stop right there.
2. Price and Payment — Be Specific
Don't just write “₹50 lakh, paid in full.” Spell it out:
How much is the advance?
When is the balance due?
Are there stage-based payments?
What if a bank is involved?
Keep it boring. Keep it clear. That’s the safest way.
3. Possession: When Are You Actually Getting It?
Put the date in writing. Add a buffer if you want — but don’t leave it open-ended.
And then ask:
What happens if they miss that date?
Are you owed compensation?
Can you cancel and get your money back?
If the answer to those isn’t in the document, that date means nothing.
4. The One Clause Most People Forget: Title Guarantee
This one’s huge.
The seller should confirm that:
They have full rights to sell
The title is clean and clear
There are no loans, disputes, or “pending permissions” hiding in the background
Ask for an indemnity clause too. If the title turns out to be junk later, they should be liable — not you.
5. Force Majeure (The Fine Print That Became Big During COVID)
This clause covers weird stuff — pandemics, natural disasters, bans — that make the deal impossible to complete.
Every agreement has one now. Make sure:
It lists specific scenarios
It doesn’t give the seller a free pass to delay forever
6. Dispute Handling — Keep It Local, If You Can
Where will things get sorted if there's a legal mess?
Do you want arbitration or court?
What city’s jurisdiction applies?
If you’re based in Bangalore, and your contract sends you to a Delhi court, good luck chasing resolution.
7. Registration, Stamp Duty, Legal Fees — Who’s Paying?
Most people assume the other side will “take care of it.”
Bad idea.
Break it down in the contract:
Stamp duty: buyer or split?
Registration charges?
Who’s paying the advocate?
Who handles municipal updates?
Get this on paper now, not post-deal over WhatsApp.
Quick List: Mistakes That Blow Up Property Deals
Signing a builder’s format without reading a word
Relying on verbal promises (parking, access, extras)
Skipping legal review to “save time”
Paying in full before registration
Not asking for original documents
How to Do It Right
Look — you don’t need a 40-page contract and 5 lawyers. You just need one that actually protects you.
Do this:
Get the title and encumbrance checked
Put all financial terms in writing
Add timelines + penalties for delay
Use escrow or staggered payments if the deal is big
Have your own legal advisor go through it — not just theirs
Bottom Line: Property Is a Long Game. Don’t Play Short-Term.
A real estate contract isn’t a formality. It’s your protection — when things go smooth, and especially when they don’t.
You’re not being paranoid for asking questions or pushing back on vague clauses. You’re just doing it right.
At Lex Certitude, we help buyers, founders, and real estate investors lock down solid, enforceable contracts that hold up — even if the market doesn’t.
Download Our Real Estate Contract Readiness Kit.
