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From law practice: A draft contract with comments and revisions, but also errors, was mistakenly submitted to the Land Registry
During one mass transfer of real estate (flats into personal ownership) we encountered a funny situation. A client had mistakenly printed and submitted to the Land Registry a draft contract with comments and revisions and even errors. However, it was a perfect contract in terms of content, so there was no problem.
Unfortunately, however, it only gave a contact address, not a permanent address, and the client’s name had been changed. However, we managed to negotiate with the Land Registry that it was an obvious scribal error and so the transcription was saved and went almost to everyone’s liking.
Fortunately, the land registry office does not have obviously ossified officials, but flesh-and-blood people who are easy to talk to. Nevertheless, it is advisable to avoid similar mistakes, because elsewhere one may stumble, or there may be a small but practically irremediable error or lack of contractual documentation. It is better to prevent all this than to try to deal with the consequences.
Which are the four biggest mistakes?
Be aware that a real estate agent does not represent you when buying a property
A major source of problems when buying property is the fact that sellers or buyers often rely entirely on estate agents or brokers, “blindly” trusting them and not verifying the information they receive from them. Real estate today is sold by “anyone” and there are no legal boundaries that should guarantee the quality and level of their work. A real estate agent has a different interest from the buyer and the seller. He or she is mainly concerned with the booking and commission and may therefore underestimate the risks and comfort of the client.
In practice, this situation leads to unnecessarily high commission paid by the buyer, the risk of the seller not getting paid for the property and a number of other problems that can be relatively easily avoided.
Don’t rush it!
Don’t rush it! Even if you really like the property, don’t rush to respond and especially don’t sign anything on the spot. Leave yourself time to think about it, discuss the purchase with your loved ones. Moreover, when dealing with a real estate agent, always imagine that you are in the Persian market where everything is bargained for. Yes, this is the reality of the real estate business. The more you show willingness to buy at the beginning, the higher the price you will end up paying for the apartment.
Beware of the offer to “close the reservation.” A reservation agreement, or contract for future purchase, is obviously in place and is very important. But if someone offers it to you when you first see the apartment just so you can be guaranteed that no one will blow you off and you can make up your mind in peace, know that this is not what the contract is for at all. As a rule, you agree to pay a reservation fee, which would be forfeited to the seller if the purchase contract is not concluded. This fee usually amounts to 3-5% of the purchase price of the property.
Real Estate Purchase or Sale
We provide a complete package of legal services related to real estate sales and purchases, including reservation contracts and escrow services. We will also help you with all tax and land registry issues. Our work is fast and accurate, ensuring a worry-free transaction. You’re also welcome to pay after services are provided.
Tip: Selling a home is a once-in-a-lifetime deal for many of us. We certainly don’t want to risk the inconvenience that could result from a poorly drafted purchase agreement or neglect of other legalities. Check out our separate article for all the important steps in the process of selling an apartment.
Pay attention to the purchase contract
Whether you are selling or buying a property, pay attention to the contents of the purchase contract. It is not only the document that makes you the owner of the property, but also the document that should reliably protect you in the future.
Don’t take any risks when paying the purchase price and use a solicitor’s escrow
Watch who you pay and how you pay. Whether you are the buyer or seller, never accept payment of the purchase price without a lawyer’s or other escrow. The method and form of payment of the purchase price is the biggest pitfall of the entire real estate transaction. Using a lawyer’s escrow will make the whole thing easier. The attorney will open a special bank account with a money institution where the buyer will deposit the purchase price. This account must be kept separate from the lawyer’s other funds to avoid confusion with other clients’ money or even with the lawyer’s own money. After the title is registered in favour of the buyers, the lawyer releases the amount of the purchase price to the seller. If, on the other hand, anything goes wrong, the registration of title in favour of the buyer does not take place and the whole real estate transaction fails, the lawyer will return the purchase price to the buyer and the seller will keep his property.
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Download the free e-book 5 Tips to Buy or Sell Real Estate Risk-Free and go smoothly through the process of selling or buying a house, condo and land.
Tip: Selling an apartment or house is not easy. At least that’s what we hear from real estate brokers who cannot recommend self-selling for perfectly logical reasons. But is it really so hard that you can’t handle it yourself? Whether your motivation for starting to sell without the help of a real estate agent is the desire to avoid paying commission or you simply don’t trust brokers, we’ll tell you how to proceed, what to look out for and when it’s better to seek the help of a professional. Read our separate article on this topic.