What is Builder Buyer Agreement?

Builder Buyer Agreement is a legal document or a contract between home buyers and builders. The agreement has all the terms and conditions of the transaction between buyer and builder. Both the parties have to comply with the terms specified in the builder buyer agreement. 

The builder buyer agreement became a mandatory legal document in the post RERA real estate market. Earlier, the agreements were biased and were mostly in favour of the builders. The key provisions to be included in the builder buyer agreement are:

• Builder submits a pro-forma while registering his project with the RERA along with the application and necessary documents.

• It is a guiding document for buyers and builders to carry out responsibilities as mentioned

• As per the clauses, a builder cannot ask for more than 10% of property value from buyer

• It is a legal requirement to sign a builder buyer agreement.

• The legal agreement makes it mandatory for builders to compensate in case there is a failure in providing promised amenities.

The section 13(2) of law states that the builder buyer agreement must have each and every minute detail. The particulars to mentioned include:

• Development of the project

• Construction of building and apartments

• Specifications and internal and external development works

• Date of completion and possession 

• Mode of payment

• Date of payment 

• Rate of interest in case of default

• RERA registration

• Buyers’ right to cancel/assign the property

• Refund policy

• Any grace period taken by the builder

• Force majeure clause

• Consideration for the property and what is excluded (such as maintenance, parking, electrification charges, etc.)

• Property particulars like fixtures, clear title, jurisdiction/arbitration clause

This is all you need to know about the Builder Buyer Agreement.

I first came across the term RERA builder buyer agreement, when I bought an apartment in Bangalore. I can share my insights about the same.

What is the builder buyer agreement under RERA?

A builder buyer agreement, also known as a BBA, describes the conditions that a builder and a buyer agree upon regarding the delivery of one of the units in a builder's housing project. 

Conditions in an agreement between builder and buyer might be anything from carpet and super area requirements to possession dates, building layouts, delivery delays, payment schedules, etc.

The Supreme Court of India ruled that the nation must move to a standardised Builder Buyer Agreement (BBA). According to the supreme court, the Builder Buyer Agreement is a crucial tool for protecting purchasers' interests. 

In accordance with the RERA regulations, the Supreme Court urged all parties to create a thorough proforma of the RERA builder buyer agreement.

Read More:

In the past, delayed development projects in the Indian real estate industry retained clients' money invested in these unfinished projects. I have been a victim of such delayed construction and possession myself. Before the RERA was implemented, disgruntled homebuyers like me had no reliable means of recourse. That is when my builder friend told me about the

buyer builder agreement which is a

contract that protects homeowners' rights and ensures that the delivery complies with the agreed-upon terms and conditions. 

Builder buyer agreement in Hindi and English

The "Agreement for Sale" is actually referred to as a "Builder Buyer Agreement." According to the Builder Buyer Agreement, the property in question is officially transferred into the name of the new owner, subject to a set of criteria that both parties can agree to. The entire property sale is governed by the Builder Buyer Agreement. It contains provisions, annexures, terms, and unique details regarding the sale or transfer of property.

"एग्रीमेंट फॉर सेल" को वास्तव में एक "बिल्डर बायर एग्रीमेंट" कहा जाता है। बिल्डर बायर एग्रीमेंट के अनुसार, विचाराधीन संपत्ति आधिकारिक तौर पर नए मालिक के नाम पर हस्तांतरित की जाती है, जो क्राइटेरिया के एक सेट के अधीन होती है, और जिस पर दोनों पक्ष सहमत हो सकते हैं। पूरी संपत्ति की बिक्री बिल्डर बायर एग्रीमेंट द्वारा नियंत्रित होती है। इसमें संपत्ति की बिक्री या हस्तांतरण के संबंध में प्रावधान, अनुबंध, शर्तें और अद्वितीय विवरण शामिल हैं।

Builder buyer agreement format as per RERA

The Builder Buyer Agreement contains particular information about all deliveries and facilities related to the project. It will also act as a roadmap for the laws that will take effect in the event of either party's default.

Despite the fact that the Builder Buyer Agreement (BBA) doesn't currently have a set or common structure, I have enlisted everything that is included in a sample format that complies with RERA requirements. You can also check out Miss Sarmana’s answer to check out a sample of the format of BBA as per RERA.

As per Section 13 (2) of the RERA Act, which will control every aspect of the builder-buyer interaction, there would be no place for ambiguity or speculation.

The following details are commonly included in the Builder Buyer Agreement (BBA):

• Name of the purchaser

• Name of the developer

• Address of the structure

• Terms relating to purchases

• The apartment's location

• Super built-up area

• Built-up area

• Details about the services provided

• Parking information and payment schedule

• Cancellation fees, etc.

It is a thorough document that may have multiple pages.

The

validity of builder buyer agreement has also been explained by Miss Shreya. I suggest you go through her response too.

Charges involved in registering Builder Buyer Agreement

The Builder Buyer Agreement (BBA) is not registered in several states. However, RERA stipulates that the homebuyer must register the Agreement for Sale with 10% of the purchase price at the time of booking.

Once the conveyance has taken place, the purchaser would pay the stamp duty. The stamp duty rates can be adjusted depending on the amount paid at the time of booking. This clause benefits homebuyers because the developer is bound by the terms of the Builder Buyer Agreement.

Hi there,

Mr Aakarshit has perfectly mentioned a builder buyer agreement is a contract made between buyers and builders. It is an important piece of legal document you must sign and read thoroughly before you purchase a property. Since both the article was written by Mr Aakarshit and Ms Shreya Singhal mention the meaning of builder buyer agreement, I want to share with you 'how a builder buyer agreement sample looks. This will help you understand what is mentioned in flat purchase agreement with builder.

'This Flat Buyers Agreement (“Agreement”) is executed on this [ ] day of [ ] at [

].

BY AND BETWEEN

____________________, a company duly incorporated and

registered under the Indian Companies Act, 1956, having its Registered office at

______________________________________________________________

acting through its Authorized Signatory _______ duly authorized vide

Board‟s resolution dated __________to sign and execute this

Agreement on its behalf (hereinafter referred to as “Company”, which expression

shall unless it be repugnant to the context thereof, shall be deemed to mean include

its assigns, nominees and successors in interest) of the First Part.

AND

Shri / Smt.

……………………………………………………………………….………………..

Son / Wife / Daughter of

…………………………………………………………..…………….

Resident of

………………………………………………………………………………………

…………………………………………………………………………………………………

….

(To be filled in case of single allottee)

OR

1) Shri / Smt. ………………………………………………………………

…………………….

Son / Wife / Daughter of …………………………………………………………..

…………..

Resident of

……………………………………………………………………………………..

…………………………………………………………………………………………………

……

2) Shri / Smt. ………………………………………………………………

…………………….

Son / Wife / Daughter of …………………………………………………………..

……………

Resident of

………………………………………………………………………………………

…………………………………………………………………………………………………

…….

(To be filled in case of joint allottees)

2

The terms & conditions of this buyers Agreement have been read and understood

Allottee(s) by me/us and I/we hereby accept the same. Developer

OR

M/s. ……………………………………………. a Company incorporated under the

Companies Act, 1956, having its registered office at …………………..

……………………………………………….. through its Director Shri

………………… , duly authorized by Board of Directors vide its resolution dated

………… .

OR

M/s. ……………………………………………. a Partnership Firm registered under

the Partnership Act, 1932, having its office at …………………..

……………………………………………….. through its Partner Shri …………………

S/o Shri …………………. R/o

OR

M/s.……………………………………………. a Proprietorship Concern, having its

office at ………………….. ……………………………………………….. through its

Sole Proprietor Shri ………………… S/o Shri …………….…… R/o

……………………………………………………………………..

(hereinafter referred to as the “Buyer”, which expression shall include his/her/their

respective heirs, executors, administrators, legal representatives and permitted

assigns) of the Second Part.

(The Company and the Buyer are hereinafter individually referred to as “Party” and

jointly as the “Parties”).'

Now, this is how a sample of builder buyer agreement looks like. You can also refer to Ms. Shreya’s attachment to check the same.

I agree with Ms Shreya about the builder buyer agreement registration fees. When I signed my builder agreement the charges for builder buyer agreement were 6% since I am a man. 

I would like to conclude by telling that what Mr Aakarshit and Ms Shreya have mentioned is very informative. Please do check their answer and share their write up among your friends and family members to spread the awareness about flat purchase agreement with builder.

Read more:

When me and my husband were out in the market looking for our dream home, we did our research. It is important to know about legal issues that may occur and some provisions to keep yourself from getting conned. In 2018, we contacted a property lawyer who happens to be a family friend. We had almost finalized a flat and were about to enter into agreement. We asked him what is builder buyer agreement. He patiently explained it to us. I am going to help you know a little more about it.

As Mr. Aakarshit explained, builder buyer agreement is a legal document which highlights the responsibilities of both parties clearly. When one enters into a builder buyer agreement, they are legally bound to fulfill their roles and responsibilities.

The builder buyer agreement process starts with the builder submitting agreement proforma of allotment letter, sale agreement and Conveyance deed which they are planning to get signed by the buyer.

The buyers have the right to take it to an experienced lawyer to have a good look at all the terms and conditions. Once satisfied, they can sign it.

We bought a flat in Delhi so we got to know that builder buyer agreement charges for men are 6% of the market price of flat. For women stamp duty charges are 4%.

As I mentioned before, it is a legal document which is formed as per RERA guidelines and none of the parties can breach it. If anyone does, they are held responsible for it.

I think this is all I know about the builder buyer agreement. I shall also attach a file with builder buyer agreement format as per RERA. 

I hope this helps :)