1 - Procedures:
First Step:
When buyer and seller reach an agreement, it is necessary to draft a preliminary sales agreement (compromis de vente) with the Notary or a real estate agent: the Abafim agency refuses to be both judge and party: therefore, no drafting of the preliminary sales agreement.
This allows all aspects of the transaction to be detailed and includes the standard as well as all special clauses.
The document to be signed is called a "Sous Seing Privé" (Private Deed) and is mutually irrevocable.
At the same moment, the purchaser must pay (5 to 10% of the total price) to the Notary. The seller is under a total obligation to sell; but the purchaser retains a ten-day cooling-off period during which they can withdraw from the purchase without penalty and without giving a reason.
Also, if the purchaser needs to take out a loan and it is refused, they can withdraw without penalty (this must be mentioned in step 1).
Second Step:
At this stage, the purchaser must have settled the total amount of the sale with the Notary. (Funds already transferred)
All documents necessary for the sale will be included in the definitive deed. Both parties must be present unless they are represented by a power of attorney.
Searches – A satisfactory return from local authorities must be available to the Notary before completion. Local bodies, and in particular the National Land Commission (SAFER), must release all rights of pre-emption. (In this case, the seller's Notary should fully reimburse the security deposit.)
2 - Costs:
Agency commission
All prices issued by the Abafim Real Estate agency include our fees, which will be paid by the seller.
Notary fees
Upon completion, the Notary will collect the government purchase taxes which are calculated according to a sliding scale based on the value of the property. The Notary will add their own fees to this, and the combined total will be approximately 7% of the price of the building and excluding any contents.
A mortgage would add approximately 1% to the overall fees.
Local rates
There are two local taxes levied on all French properties.
Taxe d’habitation (Occupancy Tax): It is paid annually by the owner (or tenant) by the occupant on January 1st.
Taxe Foncière (Property Tax): It binds the buildings and the land. It is shared by the purchaser and the seller on a pro rata temporis basis and usually arrives in the autumn of the civil year.
3 - Notes:
Utilities:
The Abafim Real Estate agency can handle the transfer of contracts for water, electricity, and telephone (ADSL). (A new number will be assigned for any change in the telephone contract).
Insurance:
Building insurance is the purchaser's responsibility; the property must be insured by the day the final deed is signed.
All money transfers can be done via Swift Euro Transfer. For completion, the money must be transferred approximately one week before the deed of sale to ensure the funds are in the Notary's account on time.
If the purchaser uses a mortgage and it has been refused, he/she can withdraw without penalty.
Property prices are calculated TTC (Taxes Included) (all fees included).
Upon mandate, the seller must provide:
- An energy performance diagnostic (DPE) for any enclosed and covered building (valid for 10 years)
- A measurement according to the Carrez Law for all co-owned properties (no validity limit).
Before signing the Private Deed (Sous Seing), the seller must provide:
- An asbestos exposure report (diagnostic amiante) for any building built whose building permit was issued before July 1, 1997 (unlimited validity unless work has been carried out in the meantime)
- A report on lead exposure risks (CREP) for any residential building built before January 1, 1949 (valid for 1 year)
At the Authentic Deed:
- A termite presence report for areas declared at risk by prefectural decree (not mandatory in the 65 region except for Vic en Bigorre, but highly recommended, valid for 3 months).
Unlike in Spain, the purchaser is not responsible for the previous owner's debts.
The purchaser can choose their own Notary. Two Notaries will then share the fees (not the normal practice).
The procedures are honest: it is impossible to overbid (surenchère) once the deed is signed.