The International and Cross-Border team at solicitors Stone King LLP give an overview of the documents that you will be asked to sign when buying property in France.
When buying property in France, there are a number of documents to sign along the way. It is important to understand what these documents are – and more importantly what you are legally binding yourself to do by signing them.
1. Bon de visit
The bon de visite is an agreement that your estate agent in France may ask you to sign.
It is an agreement that confirms that if you buy the property, it was the estate agent who introduced you to it and that they should therefore get their commission from the seller. The purpose of the document is to try and prevent the seller from cutting out the estate agent and dealing directly with the buyer.
Estate agent fees in France are far higher than in England, commonly around 5%, but they can be as high as 10% of the purchase price. Estate agents will therefore want to ensure they get their commission, if they have introduced you to a property that you subsequently decide to buy.
The enforceability of a bon de visite is not guaranteed for an estate agent – they must have a written contract with the seller prior to them showing a buyer the property before they can claim any commission.
As a buyer it is generally fine to sign the bon de visite, however you should be wary of signing any other document at this stage, and if you have any concerns you should raise them with your solicitor.
2. Compromis de vente
The compromis de vente is the preliminary contract that you will sign when buying a French property. Alternatively, you may be asked to sign the promesse de vent. There is a subtle legal distinction between the two contracts but both are binding and both achieve the same end: buying a property.
The compromis de vente is a legally binding document; it is the purchase contract. By signing it, the buyer is agreeing to purchase the property, and the seller to sell the property. In some ways it is similar to ‘exchanging contracts’ in an English purchase of a property, however it happens much earlier in the process.
The advantages of this are that once the compromis de vente has been signed, the seller cannot sell the property to another buyer who offers them a higher price. However, for a buyer it means that they must be entirely sure early on in the process that they have chosen the right property.
Please note that the compromis de vente does allow a 10 day cooling off period for the buyer – and that this cooling off period is not available to the seller – but once that time has passed it is very difficult to back out of a purchase.
3. Acte de vente
The acte de vente is the completion deed. When it has been signed, the sale has been completed.
It is similar in some ways to an English title deed. It is the document that identifies the owner of a property and confirms how the property was bought, for example in a sole name, joint names or via a company.
It is usually signed two to three months after the compromis de vente. A copy of the title deed is given to the buyer a few months after completion (copie authentique). The original acte de vente will be kept by the notary who dealt with the sale of the property. Either the acte de vente (or the copie authentique) will need to be produced next time the property is sold.
For more information please contact Charlotte Macdonald, Dan Harris or Raquel Ugalde at Stone King LLP either by calling +44(0)1225 337599, or by emailing: [email protected]