What happens when you put a reservation on a property.
The process of purchasing immovable property is completed in 3 stages:
1. Reserve the property
You put down a reservation fee which can be an amount between €1,000 and €5,000 depending on the purchase price. The reservation dee is used to bind the owner, have the property taken off the market and secure it at that price agreed. Your agent or lawyer holds the reservation amount until all necessary checks are made and contracts are signed. As soon as you pay the reservation fee the property is taken off the market. The reservation fee shows that the buyer is committed but it is also a guarantee for the buyer that he or she will not get gazumped. Here at BuySell we guarantee that your reservation fee is 100% refundable if lawyers searches are unsatisfactory.
At this stage, we send the memorandum of sale to the lawyers to start the sale process.
2. Exchange contracts - specific performance
This stage is reached when the land registry searches are completed. Lawyers exchange contracts and both parties sign. If you are not present your lawyer signs on your behalf through a power of attorney.
At this stage, the purchaser pays an agreed amount (for example 40% of the total purchase price). The sale is recorded in the land registry. The procedure is called specific performance. A valid contract will be signed, stamped and registered with the Land Registry Office. From now on the land registry locks the property on your name and prevents the Vendor from the possibility of reselling.
A completion date is agreed based on the contracts exchanged.
3. Completion - To transfer the title deeds on your name and take possession.
You pay the balance of the total purchase price and the title deed is transfer to your name. At this day the buyer pays the transfer fees or VAT (Where applicable)
At the same day, the keys are handed to you and you take possession of your property. At this day also, your lawyer will connect the utility bills on your name.
If you are buying an off plan or newly built property, the title deed is not available when you take possession. You will get your title deeds when the property developer completes the subdivision of the project through the Land Registry Office.