You intend to purchase an asset, and we are delighted and grateful that you have chosen our agency to assist you.
This process can be complex and a number of questions need to be answered. The aim here is to answer these, to draw your attention to some important points, and to allow you to proceed with complete peace of mind.
Our agency is committed to accompanying you throughout all of the steps that will allow you to buy your desired property. Our team members remain at your disposal throughout the process, and the notary concerned shall be informed in real time of progress as well as any problems that may arise.
During the acquisition process, you may meet your notary in order to discuss any property and tax issues that may require clarification.
- An offer is made an accepted/Contact your notary
- Drawing up the fil (one to four weeks)
- A meeting to sign the agreement to sell
- Withdrawal period: 10 days
- Obtaining a loan: around 45/60 days
- Fixing an appointment for the signature
- Release of funds
- The last visit
- The final signature
- Receipt of your account balance and title deed
1. An offer is made and accepted/Contact your notary
You shall inform your notary that an offer to purchase has been accepted and call upon him/her to assist you.
He/she shall immediately contact the various persons concerned by the file (agency, colleagues, sellers).
At this stage you should communicate the offer made and the principal information in your possession.You must also tell us how you intend to finance the acquisition (bank loan, mutual funds, donation, etc.)
2. Drawing up the file (one to four weeks)
In multiplying the documents required as soon as an agreement to sell has been reached, the 2014 ALUR law, also known as the DUFLOT law, considerably increased the time taken to constitute a sale dossier.
If your seller has a Notary, he/she shall be responsible for collecting these documents.
If you have the same notary, the latter shall take care of compiling the file and drafting the deed almost immediately .
Many of these documents will have to be issued by administrative services (état hypothécaire), by the co-ownership property manager (pré-état daté) and by the Service de la publicité Foncière (copies of the various acts). Consequently this will lengthen the delay.
Your notary shall ask you for the following information, which will be essential for drafting the sales agreement:
- Your complete civil status certificate (for this purpose, a questionnaire will be sent to you)
- The double-sided copy of your national identity card or passport
- Your marriage contract or PACS if applicable
- Kbis and statues if applicable
- Bank details
- In the case of financing by means of a loan: loan amount, interest rate and term
It is important that you contact your bank rapidly in order to determine these amounts as they shall be essential in order to establish the loan suspensive condition.
We undertake to send you all necessary documents in order to keep you fully informed (diagnostics, property tax, general meetings, etc.).
At this stage, you must also inform your notary whether or not you intend to set up an SCI in order to acquire the property.
If you wish to create an SCI your notary is best informed to advise you.
He/she shall accompany you throughout the thought process and shall, if the option is retained, put in place the structure by drafting and registering the statutes.
3. The rendezvous for sale agreement
Once the file is complete, the notary will contact all parties in order to arrange a meeting.
The signed deed shall be a unilateral notarised sales agreement. Before the appointment, you will receive a draft deed.
The notary should be paid, before the appointment, by means of a bank transfer for:
- The reservation fee (generally 10% of the sale price, with a tangible payment of up to 5%)
- A provision of 400€ corresponding to the costs of the sales agreement (drafting and registration au droit fixe)
During the meeting, various dates will be fixed in agreement with the parties:
- The date of the fulfillment of the loan suspensive condition, if applicable;
- The deadline for the completion of the authentic deed (generally between 2 and 3 months)
You will find all of these dates in the copy of the signed sales agreement which will be sent to you by email.
Notaries today use electronic authenticated deeds, so the length of the meeting is greatly reduced. Remember to plan at least one hour for meetings.
4. Withdrawal period : 10 days
If you are not a real estate professional and the property is for residential use, you have ten days to withdraw.
This period begins to run the day after receipt of the notification by registered electronic mail.
This notification will contain the signed sales agreement accompanied by its annexes and the mandatory documents required for by the Alur law.
5. Obtaining a loan: about 45/60 days
Once the preliminary contract has been signed, it is your responsibility to take the neccessary steps to obtain your bank loan.
You must submit your file to a bank as soon as possible.
A deposit certificate may be requested by your seller.
You have a period of +/- 45/60 days (fixed at a meeting) to obtain your finance and prove it to your notary. If you do not get your loan, you must justify its rejection to your notary by means of a certificate from the bank.
This point is particularly important. The suspensive condition is only lifted upon receipt of the final offer issued by the bank. Agreements in principle are not enough.
Never let the time allowed to obtain a loan exceed the deadline without informing your notary about the reasons for the delay.
6. Fixing a rendez-vous for the signature
Your notary will be responsible for organising the final meeting for the signature in agreement with all the parties.
7. Releasing funds
- If you are borrowing:
Upon receipt of your loan offer, please send your notary a copy with details from your bank.
The notary will take care of releasing the loan.
A financial statement will be sent to you by your notary so that you may transfer your personal contribution to the notary’s office.
The different transfers must be organised at least one week before the meeting fixed for the signature.
- If you are not borrowing:
The notary will send you a financial statement with a notification which will allow you to release your funds from your bank.
Operations must also be carried out at least one week before the meeting fixed for the signature.
8. The final visit
We advise that you revisit the property before signing in order to:
- Check that the property is in good condition
- Check that the property is empty (including the cellar!) Read the meters (gas/electricity/ water)
The property must be insured on the day of the signature, contact your insurer before the meeting.
10. Signing the “acte authentique”
The final signature normally takes place between one and three months after the signing of the preliminary contract.
Remember to come with a cheque book, as you will have to reimburse your seller for a proportion of the property tax, co-ownership charges and working capital (if applicable).
When the “acte authentique” has been signed, you will be given:
- The keys to the property
- The sale certificates with and without the price mentioned (pending your deed of property)
11. Reception of your final settlement and your deed of property
Once the “acte authentique” has been signed, it must be published. It is only when the deed has been sent back from the publicité foncière that we can send it to you.
Administration delays can be long, and consequently your deed of property will be sent to you by your notary about 6 months after the sale.
Using the bank details that you will have communicated to your notary, the latter shall also settle up your account (advance fees which have not been used), and set up a transfer to credit your account.
- Transfer costs
The costs of your acquisition, usually known as notary fees, are fixed at around 7.5% of the price of sale. This is detailed in the following diagram (the example is given for a price of sale totalling 300,000€).
If the price is financed by a loan which provides a guarantee known as “hypothécaire”, additional costs representing about 0.4% of the amount of the loan may be applicable.
These costs are generally lower than those applied to a “Crédit Logement” (about 1%), consult your banker.
- Agency fees
These are due for payment once the “acte authentique” has been signed, and shall be settled by the notary’s accountant.
On the day of the signature, you must reimburse by cheque a sum corresponding with the property tax owed to your sellers for the year in process.
And, if the property is in a co-ownership, the pro-rata of charges and working capital for the quarter.
1. The description of the asset
The co-ownership regulations or the deed of property specify the original description.
It is very important to check that the property visited corresponds with this description.
Why? The original description of an asset may change over time, which is not a problem but there are in particular two important elements to check:
In a co-ownership:
The possible opening of load-bearing walls without the authorisation of the co-ownership, and annexing of common areas.
In general :
The existence of new constructions on the plot to be purchased.
If there are serious doubts about either of these elements, you may be exposing yourself to encountering problems with the co-ownership and/or town planning services.
2. Previous occupation
If you buy a property that was previously rented, it is essential to be particularly attentive to the circumstances surrounding the tenant’s departure. The latter has, under certain conditions, a right to first refusal on the property that you buy. It is essential that you check that the tenant’s departure took place in good conditions and with a due regard for his or her rights. If this is not the case the sale could possibly be cancelled.
Your notary will check all of this for you.
3. The co-ownership
Before the preliminary contract
It is essential to read the following documents attentively:
- The latest statements regarding co-ownership charges
- A dated state of maintenace and repair provided during the meeting to sign the promise to sell
- Minutes from the last General Assembly
Here you will find the following information:
- Is the condominium well managed?
- Are there any ongoing procedures?
- Is there any projected work? Refacing, for example, is very expensive. If this has been envisaged recently, you must budget for the cost of the work.
Between the preliminary contract and the sale
Generally, notaries consider that work voted for before the preliminary contract is the responsibility of the seller.
Work voted between the preliminary contract and the sale will however generally be the responsibility of the buyer. If you receive a registered letter during this period, it may well be to invite you to a general meeting. Be aware !
1. I am married
If you were married in France and have not signed a marriage contract, you are a priori considered to be married under the legal regime of the “communauté de biens réduite aux acquêts.”
In principle, the property acquired will belong to your community.
However, if you make the investment with your own money (which you owned before the marriage; or which you received by gift or inheritance), the situation is different and you must inform your notary.
If you were married under the regime of the “séparation de biens” or “participation aux acquêts”, you must inform your notary about your proportion of acquisitions calculated in comparison with the total cost of the operation.
2. I am in a partnership
You must inform your notary about your proportion of acquisitions calculated in comparison with the total cost of the operation.
It may be worth considering a PACS (civil partnership) in order to:
- Protect yourself
- Protect your partner
The cost of a PACS is approximately 385 euro and will allow you:
- To remove inheritance tax between partners in the event of the drafting of a will (60% rights without a PACS)
- To reduce taxes by allowing for a joint tax return
- As well as to benefit from numerous other protective clauses
3.Should I create an SCI ?
Many of you are wondering about the advantages in creating a “société civile immobilière”.
This is quite a complex issue and we cannot unfortunately give all the answers in just a few sentences. We would recommend that you discuss the subject with your notary.
We can nonetheless give some guidelines.
- With an SCI the joint ownership regime may be avoided
- It allows for a sharing of power between the owners
- It makes possible the provision of “clauses d’agrément” (approval clauses), in particular in the event of the death of an owner
- It allows you to anticipate a succession without losing control over a real estate asset
- The SCI must be created, incurring additional formalities and expenses
- The SCI must be managed: accounts must be monitored and regular meetings with partners organised
- The SCI is bound by a significant number of specific rules and regulations
We hope that this guide has been helpful, and has answered some, if not all, of your questions.
Your notary is naturally ready and willing to further assist you.