Signing a Promise of Sale. Do I know it all?
Prior to signing a promise of sale, it is very important that the below is revised.
- Price Agreed
- Payment terms agreed
- If there is any ground rent
- What is included in the price
- Terms and conditions to be specified in promise of sale
- Copy of plans with measurements if buying off plan
- Details list of finishes if buying finished property off plan
- Time frame for the final contract
Upon signing of the promise of sale, the notary will ensure that all information about the vendor and buyer is registered and all conditions of sale are mentioned in the document. Thereafter, a 10% or whatever has been agreed during negotiating prices is paid by the buyer as a deposit to guarantee the buyer’s intention to conclude the deal with a final deed of purchase. The deposit can be left with the notary until searches are done, or passed onto the vendor, depending on agreement made between parties. Additionally, the buyer also pays 20% of the total stamp duty due.
During the agreed time frame of the promise of sale, the Notary carries out researches on the property and verify clear legal title. Meanwhile, the promise of sale is registered with the Commissioner of Inland Revenue and the part stamp duty is paid.
Under the current scheme, first time buyers benefit from 0% stamp duty up to the first €150,000, followed by a 5% on the remaining balance. For second property owned a 5% has to be paid. (This will be discussed on a separate article)
For non EU residents, the notary will be required to submit an application for an AIP Permit (Acquisition of Immovable Property), the fee against this is of €233.
If a bank loan is required, the buyer is to ensure that the sanction letter is issued and passed on to the notary within 8 weeks of signing of the promise of sale. On final deed this will be signed at the bank and the balance is passed on to the vendor. The buyer is also obliged to pay the remaining stamp duty were applicable) and Notary fees.
An EPC (Energy Performance Certificate) is passed on by the vendor to the buyer. This document is enforced by law and it is a certificate stating the efficiency of the property you are buying. This certificate is valid for 10 years.
The buyer is to appoint an architect to have the Land Registry plan for the property done and this is passed on to the Notary.
Upon completion of the notaries work on the final transfer of the property, last payments are done and the contract is signed, following this the Notary registers the final deed or contract of sale at the public registry and the land registry.
Transfer of water & electricity is also done on contract date. In case of transfers of built property, keys are passed on to the new owners.
After the above process is complete, you would become a proud owner ?