What is a Compromis de Vente?
Originally posted on & updated on 29th June, 2024
Once your offer has been accepted and you’re ready to commit to the purchase of your dream property in France, several steps are involved, including the signing of a “compromis de vente” and the “acte authentique” on the completion date before you can open the champagne to finally celebrate your French house. This article explains these steps and their role in the property-buying process.
The Compromis de Vente
The first step in buying a property in France is to sign a “compromis de vente” (sales agreement). This document outlines the terms of the sale, including the purchase price, the deposit amount, the completion date, and any conditions that must be met before the sale can be finalised. The compromis de vente is a legally binding contract, and both the buyer and the seller are obligated to complete the sale unless one of the conditions outlined in the agreement is not met.
Who Writes the Sales Agreement
The compromis de vente is usually drafted by a Notaire (a French public official who specialises in legal documentation and transactions) or a real estate agent. The Notaire ensures that the contract complies with French property law and that all necessary details are included. Both the buyer and the seller may also have their legal advisors review the document to protect their interests.
What are “Conditions Suspensives?
In French real estate transactions, “clauses suspensives” or suspensive conditions are provisions included in the compromis de vente that allow the buyer to cancel the sale if certain conditions are not met. These conditions protect the buyer from unforeseen circumstances that may affect their ability to complete the purchase. Some common examples of suspensive conditions include obtaining a mortgage, pre-emption rights from the commune or the SAFER, obtaining planning permission, or the sale of the buyer’s current property.
If the buyer cannot obtain a mortgage, the compromis de vente can be cancelled, and any deposit paid will be refunded. Similarly, if the buyer is unable to sell their current property, they can invoke the suspensive condition and cancel the sale without penalty. Suspensive conditions are an important aspect of the buying process and can provide buyers peace of mind in a complex and stressful transaction.
10 Day Cooling Off Period
Once the compromis de vente has been signed, the buyer usually has a cooling-off period of 10 days during which they can withdraw from the sale without penalty. After this period, the buyer must pay the deposit, usually between 5% and 10% of the purchase price, and the seller is obligated to complete the sale.
The deposit can be paid directly to the seller’s Notaire or to the real estate professional (if the immobilier is authorised to receive payments and have the compulsory financial guarantee). It will be refunded to the buyer if they withdraw within the legal timeframe or if a suspensive condition is not met within the time limit specified in the sales agreement.
The Promesse de Vente
Sometimes, the buyer and seller may decide to sign a “promesse de vente” (promise to sell) to seal the deal, although in most cases, a compromis de vente will be signed later. This document is similar to the compromis de vente, but it is not legally binding. It outlines the terms of the sale, but the buyer is not obligated to complete the purchase, and the seller is not obligated to sell the property. However, if the seller backs out of the sale, they may be required to pay damages to the buyer.
The Final Signature, l’Acte Authentique
The final step in the property buying process in France is the signing of the “acte authentique” (deeds of sale). This document transfers property ownership from the seller to the buyer and is signed in the presence of a Notaire. The Notaire ensures that all necessary legal requirements have been met, including paying any outstanding taxes or fees, and that the property is covered by suitable home and contents insurance. The acte authentique is a legally binding document; once it has been signed, the buyer receives the keys and becomes the legal owner of the property.
Transfer your Currency in Time
Ensure that the balance of the funds for the total amount has been transferred to the Office Notarial before you travel to complete your French property. Our currency exchange service can assist you with securing competitive rates and ensuring the money is received in time. If required, they can set up monthly or quarterly payments for mortgage or pension payments, learn more about our fast currency exchange service.
The Role of a French Notaire
In France, the Notaire plays a pivotal role in property transactions, acting as a trusted public official who ensures the legal integrity of the sale. Unlike in many other countries where lawyers might handle property deals, French Notaires are qualified to oversee every step of the buying process. From drafting the initial compromis de vente to the final acte de vente, the Notaire is responsible for verifying the accuracy of all documentation, ensuring compliance with French law, and safeguarding the interests of both the buyer and the seller. They meticulously check property titles, manage funds transfers, and ensure all taxes and fees are correctly applied. The Notaire’s impartiality and thoroughness provide peace of mind, making them an indispensable part of buying property in France. To help you plan and budget for your property purchase, we’ve created a calculation tool to estimate the legal fees, you’re welcome!
Not Exclusively about Property
Notaires in France play crucial roles in property transactions, succession, family law, and estate planning. They manage asset transfers after death, handle wills, marriage contracts, divorce settlements, and estate administration. Their expertise and trusted position make them essential figures in significant life events, providing stability and legal assurance.
Can I Appoint an English-Speaking Notary?
When buying a house in France, you can appoint any Notaire you want, not just the seller’s. If your French isn’t strong, consider finding one who speaks English; your agent should be able to recommend one. If needed, consider hiring an interpreter or certified translator (LINK) for important meetings and legal documents.
Signing by Proxy or Power of Attorney
In France, you can grant power of attorney (known as procuration) at the Notaire, allowing someone to act on your behalf during property transactions or legal matters when you cannot be physically present. It is now possible to sign power of attorney documents online using secure digital platforms, overseen by the Notaire to ensure legal compliance, this is common especially for new-build and off-plan properties. This allows for smooth, efficient transactions, even from a distance.
To conclude, buying a property in France involves several steps, including signing a compromis de vente, sometimes a promesse de vente, and an acte authentique. It is important to work with a Notaire or legal advisor to ensure that all necessary legal requirements are met and that your interests are protected throughout the buying process. For more information, read our comprehensive guide to buying a property in France.
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