THE CONTRACT FOR THE PURCHASE AND SALE OF AN APARTMENT: WHAT DOES IT CONSIST OF AND HOW TO DRAW IT UP? ELENA GLADYSHEVA FOR BANKI.RU

How to draw up a contract for the sale of an apartment? What must be specified in it? We understand together with the lawyer, Elena Gladysheva.

 

What must be done before signing a contract?

  1. Obtain an excerpt from the Unified State Register of Legal Entities about the main characteristics and registered rights of the property. From it you can find out the owner of the property - the Seller, as well as information about existing encumbrances (mortgage, prohibition on registration actions, etc.). It is necessary that the extract is received no later than two weeks before the date of the contract.

Important: Certificates of state registration of rights to immovable property have been abolished since July 15, 2016. After that date, the title to the property is confirmed only by an extract from the Unified State Register of Real Estate.

  1. Request from the seller the documents on the basis of which he acquired the right of ownership.
  2. Request from the Seller an extract from the house book (you can get it at any Multifunctional Public Services Center in the location of the property), or a certificate from the management company. From these documents you can find out about the presence / absence of persons registered in the property.

Important: if someone is registered in the purchased property, it is necessary for the Seller to remove these persons from the registration before concluding a sales contract. Otherwise, the Buyer will have to evict these persons and remove them from the registration in court (in the case of their disagreement).

  1. Request a notarized spousal consent or a notarized statement from the Seller that there is no registered marriage.
  2. Request a power of attorney from the counterparty (a notarial power of attorney from a natural person, or an ordinary power of attorney with the seal and signature of the CEO from a legal entity). The power of attorney must contain the authorization to sell a particular property, the price of the property (fixed or at the discretion of the representative), and the authorization to submit documents for state registration with the registering authority (Rosreestr).

You can check the validity of a notarized power of attorney in a special tool on the website of the Federal Notarial Chamber of Russia.

If a contract is signed on behalf of a legal entity by the sole executive body, it is necessary to check its compliance with the information specified in the Unified State Register of Legal Entities. In judicial practice there are cases when a person acts on behalf of a legal entity and who introduces himself as a CEO but who is not the CEO at the time of the transaction.

  1. It is also desirable to request a certificate that the counterparty is not registered in the psychoneurological and narcological dispensary.
  2. Check the counterparty for bankruptcy proceedings, which can be done on the Arbitration Courts website (KAD Arbitrator system), in one of the information systems (SPARK, CASEVOOK, etc.), as well as in the Unified Federal Register of Bankruptcy Information.

    What conditions must be specified in the contract?

    1.  Subject of the contract, with a detailed indication of all the characteristics of the property, which are contained in the extract from the Unified State  Register of Legal Entities: cadastral number of the property, address, floor, purpose and area.

  1. Contract price. The contract must specify the full price of the property and settlement procedure (cash is transferred via safe deposit box, letter of credit, by transfer or in cash).


In any case, it is recommended to get a handwritten receipt from the Seller after the settlement.

It is important to specify in the contract the full value of the object, and if there are several property items - specify the value of each items separately.


Risks: if the contract price is understated, in the event of a dispute over the invalidity or unenforceability of the contract, the Buyer may not recover the real value. Courts in this case consider the behavior of the parties to be in bad faith, aimed at tax evasion, and therefore may refuse to recover from the Seller an amount greater than that specified in the contract.

Moreover, by agreeing to understate the actual value of the real estate in the contract, the Buyer underestimates the tax base for calculating the tax deduction that can be received after the acquisition of real estate.

The Seller also does not avoid the risks, since the Federal Tax Service, in the case of information on the evasion of the Seller from paying tax, additionally assess the amount of tax payable and obliged to pay a fine of 20% to 40% of the unpaid amount of tax.

  1. It is recommended to specify in the agreement the details of the Seller and the Buyer (date and place of birth, series and number of passport, the name of the issuing authority, as well as the date of issue, subdivision code and registration address) in as much detail as possible.
  2. It is recommended to specify in the contract a condition that the Seller is not married or the property is not jointly acquired. If the property is jointly acquired and there is a notarized consent of the spouse for its alienation, this should also be specified in the contract.
  3. The contract should include a condition that the parties are not subject to bankruptcy proceedings, and that there are no debts and/or any other outstanding obligations that may result in bankruptcy.
  4. The contract should specify that the parties are not deprived of legal capacity, are not under guardianship and trusteeship, do not suffer from diseases that prevent the understanding of the essence of the contract, are not registered in the psychoneurological and narcological dispensaries, when entering into the contract act voluntarily, there are no circumstances that force them to enter into a contract on extremely unfavorable conditions for themselves.

    The procedure for concluding and registering an agreement:

A sale and purchase contract for real estate is drawn up in a simple written form in copies for each party and one additional copy for the Rosreestr. In addition to the sale and purchase contract, a transfer act must be drawn up. All copies of contracts with transfer acts must be stapled and signed by each party on the staple.


All copies of the contract must be submitted jointly by the parties (or by proxy) for state registration via the Multifunctional Public Services Center.

 

Notarization of the contract is required only in the case of alienation of a share in common shared ownership. In addition to notarization, prior to alienation of the share to third parties, the Seller must offer the other owners of the property to purchase their share, or obtain their refusal to purchase it. As a rule, a notary public provides full support of the sale-purchase transaction, including notifying the other owners independently.

If the sole owner of the property alienates a share, notarization of the transaction is not required.

In any case, the most favorable way to conclude the sale-purchase contract for real estate is to certify the contract at a notary's office. This is convenient in connection with the following:

  1. The notary will independently draw up the contract specifying all the necessary conditions.
  2. The notary will check the credentials of the parties or their representatives at the time of the transaction, request all necessary documents, and independently obtain excerpts from the Unified State Register of Legal Entities and check the owner.
  3. The notary will necessarily require the consent of the agent's spouse for the transaction or a declaration that there is no registered marriage.
  4. The notary will also necessarily verify the legal capacity of the parties by obtaining information from the Rosreester about the absence of registration of the parties as incapacitated.

    Upon additional agreement, the notary can also independently send the contracts for state registration to Rosreestr in electronic form, and then notify the parties and deliver them copies of the contracts with a certified sheet on the state registration performed. 

 

Link to the practical guide on Banki.ru

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