Yes. The law stipulates that contracts of sale for a property must be notarized; if this form is not observed, the contract is null and void and thus legally ineffective. The so-called conveyance, i.e. the declaration on the transfer of ownership, must also be made by the parties before the notary public. The legislator wants to protect the purchase contract parties thereby. Contracts for land or apartments should not be concluded rashly, the notary should comprehensively inform the parties about all relevant aspects and risks.
How long does it take to complete the purchase contract?
Between the notarization of the purchase contract and the payment of the purchase price as well as the handover there are usually 4-6 weeks. This time is needed to bring about the maturity requirements. The notary must register a priority notice of conveyance in the land register for the benefit of the purchasers and obtain the cancellation documents for existing liens on real property. In addition, permits must often be obtained, such as the consent of the administrator in the case of a condominium, or the declaration of waiver of pre-emption by the community in the case of a house lot.
Which ancillary costs are incurred?
In addition to the purchase price, the buyer must also calculate the ancillary costs incurred. These are mainly the land transfer tax and the notary and land registry fees. The land transfer tax varies from state to state. In Hamburg it is currently 4.5% of the purchase price, in Schleswig-Holstein even 6.5. The notary and land registry costs are ca. at 1.5-2%, depending on the individual case, these can vary.
In addition, buyers should of course think carefully about whether they still need capital for conversion or renovation work. Depending on the condition of the object of purchase, considerable additional expenses may be required.
What if the property is rented?
Basically, the new owner is stepping into existing tenancies. Buying does not break rent. If one would like to continue to rent the property in the future, then one should inform oneself before the purchase exactly about the modalities of the tenancy (rent amount, security deposit, existing disputes from the tenancy etc.).). If one wishes to move into the property oneself, an existing tenancy can prove to be problematic. There is the possibility of the own need notice, this is subject however to high requirements, under circumstances first a process lasting months must be led.
What are building encumbrances?
Building encumbrances are certain encumbrances on the property that are not registered as such in the land register (z.B. The acquiescence of setback areas). Since the notary does not inspect the building encumbrance register, the buyers should do this themselves before concluding the contract. Existing building encumbrances can, under certain circumstances, significantly influence the value of the property.
What happens to existing encumbrances?
Land charges are almost always found in sections II and III of the land register. As far as entries in Division II are concerned, these are usually to be paid by the buyer. These are typically easements, such as rights of way or pipeline rights in favor of other properties. The notary would only be able to have these deleted if the entitled persons would grant this. However, this will rarely be the case with corresponding easements.
The situation is different with encumbrances in section III of the land register. These are so-called real estate liens (mortgages and land charges), which have usually been registered in favor of lenders of the owners. These encumbrances must be cleared, as the new owner does not want to take on the liabilities of his predecessor. Insofar as the liens on real property are still opposed by outstanding claims, the lenders will only agree to the cancellation if they receive their claims from the purchase price.
In rare cases, buyers take over existing mortgages in order to use them for their own financing.