Reservation Deposit Agreement Template for Malaysia

The Reservation Deposit Agreement serves as an essential preliminary document in Malaysian property transactions, establishing the framework for a potential property purchase. This document is commonly used when a prospective buyer wishes to secure their interest in a property before proceeding with a full Sale and Purchase Agreement. The agreement typically includes key details such as the property specifications, deposit amount, reservation period, and conditions for proceeding to sale or obtaining a refund. Under Malaysian law, particularly the Contracts Act 1950 and relevant property legislation, the Reservation Deposit Agreement creates legally binding obligations between the parties while providing flexibility for both the developer/seller and the potential purchaser during the initial stages of a property transaction. This document is particularly relevant in new development projects or pre-sale situations where properties are being sold off-plan.

1. Parties: Identification of the property owner/developer and the prospective purchaser, including full names, identification numbers, and addresses

2. Background: Brief context about the property being reserved and the parties' intentions to enter into a sale and purchase agreement

3. Definitions: Key terms used in the agreement including 'Property', 'Reservation Period', 'Deposit', 'Booking Fee', etc.

4. Property Details: Specific description of the property being reserved, including address, title details, and specifications

5. Reservation Deposit: Amount of deposit, payment terms, and acknowledgment of receipt

6. Reservation Period: Duration of the reservation period and any conditions for extension

7. Rights and Obligations: Responsibilities of both parties during the reservation period

8. Conversion to Sale: Process and conditions for converting the reservation into a full sale and purchase agreement

9. Refund and Forfeiture: Circumstances under which the deposit will be refunded or forfeited

10. Governing Law: Confirmation that the agreement is governed by Malaysian law

11. Entire Agreement: Standard clause confirming this document represents the entire agreement between the parties