Project & Payment
What is a Booking Amount?
There is a hard legal limit on what a builder can take from you before signing anything. Almost no buyer knows it exists.
The short answer
A booking amount is the formal advance you pay against the price of the flat. And there is a hard limit on it.
Section 13 of the RERA Act: a promoter may not accept more than 10% of the cost of the flat as an advance without first entering into a written agreement for sale.
Not a guideline. A statutory cap. If a builder asks for 20% before giving you an agreement, they are breaking the law.
What a booking amount is
It's the first substantial payment against the purchase price. It reserves the unit formally and forms part of what you owe — it is not a fee, it comes off the total.
It usually follows the token amount, though many builders roll the two together.
The 10% cap — the protection nobody uses
“A promoter shall not accept a sum more than ten per cent of the cost of the apartment, plot or building as an advance payment or an application fee, from a person without first entering into a written agreement for sale with such person and register the said agreement for sale.“
Ten per cent. In writing. Registered. Before anything more.
Read that again, because it contains three separate protections:
- They cannot take more than 10% before an agreement.
- The agreement must be written.
- The agreement must be registered.
A builder demanding 20% or 30% "to confirm the booking", with the agreement to follow "in a few weeks", is in breach of Section 13. That is not a negotiating position. It is a fact you can state.
Why the cap exists
Before RERA, the standard sequence was: pay a large sum, then receive an agreement drafted entirely in the builder's favour, months later, when you had already paid too much to walk away.
The cap breaks that. It ensures you see the agreement — the possession date, the carpet area, the penalty clauses, the cancellation terms — while your exposure is still limited to 10%. You can still walk.
That is a small and unglamorous piece of drafting, and it has probably saved Indian home buyers more money than any other clause in the Act.
Getting it back
Whether the booking amount is refundable depends on the agreement — which, thanks to the cap, you should have seen before paying more than 10%.
Read the cancellation clause. Typical positions:
- You cancel without cause: the builder usually forfeits some or all of it. Many agreements permit forfeiture of the entire booking amount. Some cap it. Negotiate this before signing, not after.
- Your loan is rejected: not automatically refundable. Get this written in as a condition.
- The builder fails to deliver as promised: RERA entitles you to a full refund with interest.
- The project is not RERA registered: you should not have paid at all.
Before you pay the booking amount
- Check the RERA registration. Number, possession date, progress filings, complaints against the promoter.
- Ask for the draft agreement. You are entitled to see it. Read the cancellation clause, the delay penalty, the carpet area.
- Confirm the carpet area in the agreement matches the RERA filing.
- Do not exceed 10% before that agreement is signed and registered.
- Pay by traceable transfer. Never cash.
- Get a receipt naming the unit, the amount, and that it is adjustable against the price.
“Under Section 13 of RERA you can't take more than 10% before we sign a registered agreement for sale. So let's do the agreement first, and I'll pay the rest on signing.“
Said calmly, that sentence changes the conversation. A legitimate builder will simply agree — because they know it's the law. The reaction you get is itself a useful piece of due diligence.
Booking amount vs token vs earnest money
| Token amount | Booking amount | Earnest money | |
|---|---|---|---|
| What it is | A small sum to hold the unit while paperwork is prepared | The formal advance against the purchase price | A deposit that demonstrates you are serious |
| Typical size | ₹50,000 – ₹2,00,000 | Up to 10% of the price | 10–15% (often the same money as the booking amount) |
| Legal cap | None | RERA: max 10% before a written agreement | None |
| Refundable? | Depends entirely on what's in writing. Often not. | Depends on the agreement. Read the cancellation clause. | Designed to be forfeited if you walk away |
| Counts toward the price? | Usually | Yes | Yes |
| The thing to get | A written receipt naming the unit, the price and the refund terms | A signed agreement — RERA requires one before more than 10% is taken | Written cancellation terms, before you pay |
In practice, Indian builders use these three terms loosely and often interchangeably. Do not rely on the label. Rely on what the receipt says.
Frequently asked questions
How much booking amount can a builder take?
Under Section 13 of the RERA Act, a promoter may not accept more than 10% of the cost of the apartment as an advance without first entering into a written, registered agreement for sale. A builder demanding 20% or 30% before giving you an agreement is in breach of the Act.
Is the booking amount refundable?
It depends on the agreement — which, thanks to the 10% cap, you should have seen before paying more. Read the cancellation clause. If you cancel without cause, many agreements permit forfeiture. If the builder fails to deliver as promised, RERA entitles you to a full refund with interest.
What is the 10% rule in RERA?
Section 13 prohibits a promoter from accepting more than 10% of the flat's cost as advance payment without first entering into a written agreement for sale and registering it. It exists so that you get to read the agreement — possession date, carpet area, penalty clauses — while your exposure is still small enough to walk away from.
Can I get the booking amount back if my loan is rejected?
Not automatically. Get it written into the booking terms as an explicit condition before you pay. Many buyers assume it's automatic and discover otherwise.
What's the difference between token amount and booking amount?
A token is a small informal sum to hold the unit while paperwork is prepared, with no legal cap and often no refund. A booking amount is the formal advance against the price, and it IS capped — at 10% — before a registered agreement. In practice builders use the terms loosely, so rely on what the receipt says, not the label.