Jump to content

Process for making an offer


Recommended Posts

We're looking to buy a house in 76, and are planning a two to three day trip in the next few weeks to view some suitable houses. Assuming we find one that meets our requirements, we'd like to be able to make an offer there and then, and set the ball rolling (we know that the process can take a long time in France and so want to get going asap). What I want to know is, what do we have to do to make an offer and get the ball rolling?

If anyone can give me a general outline of what this involves and what we would need to bring with us, I;d be grateful. I also have some specific questions:

- Do you have to sign the compromis de vente in order to get an offer formally accepted?

- At what point do you have to pay the deposit?

- I've read that the deposit is normally 10%. However, some English friends who live in the south of France told us that they negotiated a much lower deposit (about 1.000 euros). Is this normally possible?

- At what point does a notaire have to get involved, and how do you arrange this?

Basically, I'm trying to understand how far we would be able to get "in one go" (i.e. at first visit), and whether we would need to make a return visit in order to sign more paperwork. If so, would this need to be both of us or could one party sign?

Sorry to ask so many questions - grateful for any clarity.

Thanks,

Rob
Link to comment
Share on other sites

- Do you have to sign the compromis de vente in order to get an offer formally accepted?
If your offer is at the asking price, then it is accepted when made and the house taken off the market. If below, or with strings attached, the seller is free to accept better offers up to the signing of the compromis. The compromis has to be signed by all sellers and all buyers to make the sale firm, you can receive and return it by recorded post. Though the final acte de vente has to be signed in person at the notaire's premises, by you or by power of attorney.

- At what point do you have to pay the deposit?
It is normally payable, to the notaire, at the end of the 7-day so-called 'cooling off' period which starts when the buyer receives his copy of the compromis signed by the seller.

- I've read that the deposit is normally 10%. However, some English friends who live in the south of France told us that they negotiated a much lower deposit (about 1.000 euros). Is this normally possible?
It's basically up to the notaire dealing with the sale, who is responsible for holding the deposit. If you are trusted you may pay less, or even nothing at all. It is normally 10%, at least in your part of France, because that is the basic figure that becomes payable under French law should the buyer default. Notaires don't want to have to chase you for an extra 5%, particularly if you are in another country.

- At what point does a notaire have to get involved, and how do you arrange this?
You don't have to arrange this, the seller, and/or agent will already have engaged a notaire, or the notaire may even be acting as the selling agent. The notaire often draws up the compromis, though this can also be done by a qualified agent immobilier.

Link to comment
Share on other sites

Never look at property at the weekend - it makes life difficult.

10% deposit is the required amount, you cannot pay less without a struggle. You will be deemed awkward.

You make the offer verbally to whomever is selling the property. If you offer less, the vendor may keep the property for sale. You will need to sign the Compromis later, usually a week later. This is the point you use the Notaire for the first time. Choose one locally. Or arrange for someone to sign it for you with power of Attorney, although IMHO and from experience of others, this is a BAD idea. I would never use an "Agent" either. Some agents can perform the compromis, but this can be fraught.

Only one of you needs to sign the Compromis, but one of you must have a signed declaration that the other can take to the signing permitting signature on behalf of them.

(One of the arguments we had at the Compromis stage was the exchange rate, since the English vendor had advertised the house in sterling, and you have to pay in Euro.)

You then have the 7 day cooling off period. This is your only chance to pull out. You then pay the deposit.

Be prepared to have to make several trips.

At the signing of the Acte, the Notaire will provide a translator free, by law. DON'T let anyone dupe you into paying for one.

Link to comment
Share on other sites

Thanks for all the info - I think I'm getting the picture.

A couple more questions, if I may:

- A power of attorney may be an option for us, as we have some very good friends in the area. How would we go about setting this up?

- When it comes to paying the deposit, how do you physically go about paying this? (We will have no French bank account at this point, just £sterling in the UK.)

- I understand that it typically takes about 3 months to complete a purchase. Does this start from the date an offer is accepted, or the date the compromis is signed and the deposit paid?

Thanks again,

Rob
Link to comment
Share on other sites

The amount of the deposit is between you and the vendor. Normally the amount of liquidated damages if you fail to complete the purchase is set at the deposit. We paid Francs 1550 because that was the most we could extract from the local cash machine on a Friday afternoon  

 

Link to comment
Share on other sites

"You will need to sign the Compromis later, usually a week later. This is the point you use the Notaire for the first time. Choose one locally. Or arrange for someone to sign it for you with power of Attorney, although IMHO and from experience of others, this is a BAD idea. I would never use an "Agent" either. Some agents can perform the compromis, but this can be fraught."

Sorry, don't wish to sound pedantic, but there are some contradictions here which can only confuse.

There is no need to sign the compromis later - it can be signed at the time of making the offer if the sale is straightforward and a pre-printed form can be used. However, you do usually need to provide evidence of identity, address, birth and marriage certificates etc at this stage. So it is indeed usually better to get an individual compromis drawn up, as this can include any particular clauses required, and this is what takes the time.

All buyers, if buying jointly (which is a must in most circumstances under French inheritance procedures - and you can't normally save taxes etc by putting it in one of a couple's names only), and all sellers must sign the compromis. This can often be a major headache when houses are being sold after the death of a parent of a typically large French family.

There is no need to use power of attorney to sign a compromis (I agree this is probably a bad idea), if you are no longer in the locality it can be sent, and returned, by recorded post. The 7 day period during which you can legally withdraw starts from when you receive the compromis signed by the vendors - you can have already signed it, though in practice it seems to work better if the vendor signs, and the forms are then sent to the buyer. However, by making an offer you have already made a verbal contract so withdrawing afterwards without a very good reason, particularly after signing the compromis, is not taken too kindly by the French.

You don't need to appoint a notaire. One will already have been appointed by the time you get to compromis stage - in fact if, as recommended above, the agent doesn't draw up the compromis and no notaire has been appointed, who else can draw up the compromis?

A notaire is an impartial lawyer whose duty is towards the French government rather than either buyer or seller, so normal practice is that one notaire oversees the sale. A lot of British people used to the English system rather than French law want to appoint a second notaire, supposedly to 'represent' them. Although there is no legal reason why this cannot be done, in practice it can sometimes cause confusion and resentment between notaires and only add to the delays. If the notaire already appointed is known for being slow, inefficient and/or uncooperative (and some are - we are talking about French fonctionnaires here after all) then it is a good idea to appoint a second notaire to speed things up. Otherwise it is likely only to add to the bureaucracy.

Because of the known slowness of French lawyers (this is the main reason for even a straightforward transaction taking an average of 12 weeks from agreeing the sale to signing the Acte de Vente) I don't think it is a good idea to use the notaire for the compromis - this has been known to add several weeks to the process, weeks during which the sale is not confirmed, which causes uncertainty and anxiety for the buyer. The agent has an interest in confirming the sale quickly so can act much faster. Don't forget that in most of France (certainly in 76) it is the buyer who pays the agent's commission, so the agent is working for the buyer rather than the seller, which is the case in England. Nevertheless, a lot of people like to have the compromis checked by a bilingual lawyer, whether compiled by notaire or agent, and this is what the 7-day 'cooling off' period is intended for - rather than an opportunity to change your mind about an agreed transaction.

My understanding is that under French law damages of 10% of the agreed 'nett vendeur' price (plus certain fees etc) is payable by either buyer or seller should either default on the sale after signing the compromis, and this is why the deposit is usually set at 10% of the purchase price. There's no need to extract money from the cash machine at odd times to pay this - in fact agents or sellers who demand money 'up front' in this way should be avoided like the plague. The deposit does not become payable until the end of the seven days after receiving the compromis, and should always be paid to the notaire (though legitimate agents must by law have a secure account for holding deposits why not do as the French do and only pay the notaire). This gives more than enough time to arrange for bank transfers, or to use a currency exchange company to get the best rate. As noted by another user, transactions in sterling can cause all sorts of difficulties in agreeing exchange rates (worse still when the notaire has to calculate the taxes and fees payable) and are only normally likely to arise in private sales between British buyers - our advice is to avoid this at all costs. Transactions in France should only be done in French currency.

Sorry to go on at length, but I feel some clarification is needed based on current practice and our own experience (gained professionally as well as being ordinary buyers and sellers) in the French property market.

Link to comment
Share on other sites

An interesting (?) aside

I sold property in England and accepted a deposit of just 5%. Buyers defaulted, declared bankrupt so my damages were limited to  the deposit. The market went over a cliff in the meantime and it cost a bundle. Never again - if the buyer cannot afford the full 10% he can find another seller.

John

not

Link to comment
Share on other sites

I recommend that you do get yourselves a French bank account as soon as you are certain this is for you.  It will make transactions sooooooooooo much easier.

 

Your UK bank will sting you each time you make a transfer, so it is much better to make one transfer to your French account and then pay all of the items from there than to make many transfers from the UK

Link to comment
Share on other sites

[quote]Never look at property at the weekend - it makes life difficult. 10% deposit is the required amount, you cannot pay less without a struggle. You will be deemed awkward. You make the offer verbally t...[/quote]

Unless of course the person happens to be deceased, as in our case which we didn't know and weren't told by the estate agent, causing untold drama and long-drawnout frustrating negotiations. Sounds daft, but just make sure the person selling is still alive because if it is one of those intricate inheritance sales, be prepared to wait two+ years and loose a lot of hair and weight.
Link to comment
Share on other sites

And that can be two years just to get all the signatures on the compromis de vente . Seriously, not all inheritance sales are that difficult (unless the seller actually dies during the sale process, but that's another story altogether of course) but it is one of many potential danger spots, and if there are a lot of heirs it may be best to avoid such places if you want a fast purchase.

I don't want to give the impression that there is one process and one process only - this is France after all, which thrives on variation. But there is a lot of urban myth and misinfomation around about the French house buying system.

Link to comment
Share on other sites

Opalfruit said:

At the signing of the Acte, the Notaire will provide a translator free, by law. DON'T let anyone dupe you into paying for one.

Are you sure about this my friends were told by the Notaire & Agent that they had to pay...no choice

 

Bob

Link to comment
Share on other sites

[quote]I recommend that you do get yourselves a French bank account as soon as you are certain this is for you. It will make transactions sooooooooooo much easier. Your UK bank will sting you each time ...[/quote]

I can see that opening an account sooner rather than later makes sense. However, from previous experience (I lived in France for a year 13 years ago), is it possible to open a French bank account without having a permanent address in France first? I seem to remember having to provide an "attestation de logement" (and maybe even confirmation of employment?) before they would open an account for me.

Rob
Link to comment
Share on other sites

You can - though you will still need proof of your address in Britain, as well as identity (this is because of international anti-money-laundering agreements). Not all banks may offer this - if in doubt ask for 'compte étranger'.

In practice though it's better to wait at least until you have a confirmed sale on the house you want. As you have had a bank account in France before you will know that it makes an awful lot of sense to use a bank close to where your house is - or at least in the same general region.

An alternative of course is the Britline account - I believe Barclays offers something similar but know little about that.

Link to comment
Share on other sites

Im a new member..so hopefully I am using the correct topic box

I have a small village house in Montsoreau dept 49 and we go there for holidays as often as we can. We,ve had the house 4 years and looked into buying a longere for the purpose of running a Chambres d,hote.We found a suitable place just outside Chinon dept 37 ,5 bedrooms  , 2 staircases , enclosed large garden  and 2 large salon and lg Kitchen / dinning area. We had the Compromis sent to us after paying 9000 Euros for a survey report..everything fine...and we have arranged to meet notaire and sign with him on the 23rd July.Today our immoblier phoned us to say that the vendor has sold it to someone else and signed the Compromis with these other people yesterday.I thought this sort of thing only happened in England,,,do I have legal address from the vendor , esp with regards paying out so much for the Survey and booking Ferries etc this time of year.Any advice will be gratefully received

  Daffie

Link to comment
Share on other sites

There are no legal obligations on either side until the Compromis de Vente is signed and, for you, the 7 day cooling off period has passed. It is usual to sign the Compromis before organising a survey and having a clause suspensive inserted in the compromis giving you an option to withdraw, and have your deposit returnrd, if the survey is unfavourable. As you hadn't yet signed the CdeV then the vendor was quite within his rights to sell to someone else. 9000€ sounds like an awful lot for a survey so I guess it must be very detailed and the property very large so it might be worth trying to sell it to the new purchaser at a knock down rate. Don't be surprised if the purchaser isn't too interested as the French rarely bother with surveys.
Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...