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The Home Equity Agreement serves as a crucial instrument in Indonesia's evolving property finance landscape, providing an alternative to traditional mortgages and loans. This document is typically used when property owners seek to access their home equity without taking on debt, instead sharing a portion of their property's value with investors. It must comply with Indonesian property law, particularly the Civil Code and Mortgage Rights Law (Hak Tanggungan), and requires proper registration and notarization. The agreement covers essential elements including property valuation, equity share calculations, occupancy rights, maintenance obligations, exit mechanisms, and dispute resolution procedures. It's particularly relevant in urban areas where property values are significant and owners seek flexible financing options while retaining residence rights.

1. Parties: Identification of all parties to the agreement, including complete legal names and addresses

2. Background: Context of the agreement, including property details and purpose of the arrangement

3. Definitions: Detailed definitions of key terms used throughout the agreement

4. Property Details: Comprehensive description of the property, including certificate numbers and registration details as per Indonesian requirements

5. Equity Share Structure: Details of the equity sharing arrangement, including percentages and valuation methodology

6. Payment Terms: Terms of any initial payment and future equity distribution

7. Rights and Obligations: Detailed responsibilities of each party, including property maintenance and payment obligations

8. Property Usage Rights: Terms governing the occupancy and use of the property

9. Term and Duration: Length of the agreement and conditions for extension

10. Exit Mechanisms: Procedures for selling the property or terminating the agreement

11. Security Interests: Details of mortgage rights (Hak Tanggungan) and other security arrangements

12. Registration and Notarization: Requirements for legal registration and notarization as per Indonesian law

13. Representations and Warranties: Standard declarations by all parties regarding their capacity and the property's status

14. Default Events: Circumstances constituting default and consequent remedies

15. Dispute Resolution: Procedures for resolving disputes, including jurisdiction and governing law

16. Notices: Communication procedures between parties

17. General Provisions: Standard boilerplate clauses including severability, entire agreement, and amendments