What is a red flag in a contract?

A red flag in a contract is any term that quietly shifts all the risk to you. The classics: unlimited or uncapped liability, termination rights that only the other party holds, scope described vaguely while your obligations are precise, and auto-renewal clauses with narrow cancellation windows.

For service providers, add IP clauses that transfer more than the deliverables, payment terms with no dates, unlimited revisions, and non-competes hiding in service agreements. For clients, watch for large non-refundable deposits with no performance milestones.

One reading habit catches most of them: for every obligation, ask what the consequence is when it is missed, and for every right, ask whether both parties hold it. A fair contract is boring and symmetrical. Asymmetry is the flag.

Starting from a balanced legal contract template means the flags never get written in.