1057 FAQ on real estate purchases

Here is a first list of FAQ on real estate purchases.
Of course IT IS NOT the definitive word about the matter, but it is rather a general information and an exercise for myself: suggestions and criticisms well accepted.

So ladies and gentlemen...

[B]FAQ on real estate purchases – part 1[/B]

1 – A verbal agreement or a verbal promise is legally binding ?
NO: all the agreements and contracts MUST be written: words value is zero

2 – What is a “proposta di acquisto” ?

It is a (written) proposal with whom the buyer offers to the vendor to buy his property at a specific price.
The proposal can be repealed until the vendor accepts it.
The buyer can put forward a “irrevocable proposal” that is a proposal that cannot be repealed: in this way the buyer is bound to buy.
This kind of proposal should be submitted to conditions: a deadline, non-existence of mortgages or irregular building permissions.
Some estate agencies push the buyer to sign this kind of proposal when he’s found the property he likes: a common sense advice is to sign nothing without legal advice.

3 – What is a “compromesso” ?

It is a (written) contract.
Its correct legal name is “contratto preliminare di vendita” or preliminary contract.
With a compromesso the vendor promises to sell and the buyer promises to buy.
They are both legally bound, BUT remember that a compromesso
- doesn’t transfer the property, that remains in the vendor’s hands
- is legally binding only for those who signed it, so a third party has no legal knowledge of it
- is just a “promise” and like all promises could be not kept: the vendor could sell to another person or decide to sell not anymore, the only way in this case is to take legal action against him for the damages

4 – Is a deposit necessary when I sign a compromesso ?

No law imposes it, but it is normally requested by the vendor.
In this case the deposit (caparra) has the function to reinforce the agreement: if the buyer change his mind and decide that he doesn’t wont to buy, he looses the deposit, if is the vendor to do so, he has to pay the double of the received deposit.
In both cases, the defaulting party could be also sentenced to pay for the further damages.

5 – who draft the compromesso ?
There is no rule.
A compromesso is a “private” contract, so it has no specific formalities.
It can be even drafted by the parties, but usually preliminary contracts are drafted by estate agencies (many), lawyers (few) and notaries (most part). When the contract is drafted by non professional people, there’s a risk of inaccurate and superficial clauses.
My advice is to use a notary.
This gives economic and legal advantages.
Preparing the compromesso, the notary will check the effective property of the vendor and the presence of mortgages, doing in advance part of the job he’ll do for the “atto pubblico” and warning the buyer about potential problems.
You have to remember that while the goal of a sales agency is to sell (and so some of them could be tempted to hide the problems), the duty of a notary is to take care of the legal regularity of the contract and to give guarantees to both parties.
Moreover, if the notary who draft the compromesso is the same who’ll draft the atto pubblico, usually he’ll apply no fee for the preliminary contract.
Remember that a compromesso drafted by a notary remains nevertheless a “private contract” (see question 3), in this case the notary acts as a legal expert (just like a solicitor) but he doesn’t reinforce the contract.

6 – Is it possible to reinforce the compromesso
Yes.
You can ask to the notary to register the contract in the Land Register (Conservatoria). In this way the preliminary contract becomes more than a promise being legally known by third parties.
The vendor cannot sell the property and mortgages subsequently registered are harmless: the property is booked at your name.

7 – Are there different rules when the vendor is an entrepreneur ?
Yes, there is a new law just approved.
If the vendor is an entrepreneur who builds houses and you sign with him a compromesso regarding an house he has to built, he MUST give you a bank or insurance guarantee for all the money he receives from you before the atto pubblico.
If the vendor goes bankrupt before the atto pubblico, you can take the guarantee.

8 – Is a compromesso always necessary ?
Not at all.
If you already have the availability of your money and if the vendor is ready to sell, you can sign straight the atto pubblico.

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Part two under construction....