What is an agreement to sale?

An “Agreement To Sale” is a contract between seller and buyer, where seller agrees to sell a property to buyer at future date, subject to terms and conditions mentioned in the agreement.

It is an important document in the process of sell and purchase of a property. It contains terms & conditions agreed and signed between the parties to sell a property at future date.

An Agreement To Sale is an important document for Home loan application. It is mandatory to frank the agreement. The franking cost is decided by your bank, generally, the franking cost ranges from Rs. 200 to 0.1% of selling price.

Agreement To Sale is not a Sale deed and it doesn’t convey the ownership. it is just a preliminary agreement with agreed terms and conditions to execute a sale deed at future date.

Step by step procedure to execute an “Agreement To Sale”:

Step 1: Below are the list of documents require from seller to prepare an “Agreement To Sale”

• Absolute Sale deed

• Khata certificate & extract

• Latest tax paid receipt

• Encumbrance certificate (EC)

Step 2: Prepare the draft in word format. A draft looks like the below image,

Step 3: Exchange the draft with seller, buyer, advocate and bank through an email for mutual confirmation and seek approval to proceed

Step 4: Print the draft on document paper

Step 5: As per your Bank, if the stamp duty is less than Rs. 1000/-, buy non-judicial e-stamp paper from co-operative bank, court, or sub-registrar office near you.

An e-stamp paper looks like the below image,

If your stamp duty is more than Rs. 1000/-, do franking

(For high-value stamp duty, prefer franking instead e-stamp because cost of error is less in franking mode whereas cost of error is more in e-stamp mode, even a small error in e-stamp cost your complete stamp duty)

Step 6: Seller and buyer sign the agreement on all pages. Witness sign at last pages of agreement.

An “Agreement To Sale” looks like the below image.

In a separate answer, we wrote more about agreement franking and its cost, here is the link to the answer.

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In Bangalore, we provide end-to-end assistance for “Agreement to sale” drafting + execution + franking + home delivered. To opt for our service, please Whatsapp to +9 1 - 9 7 4 2 4 7 9 0 2 0.

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