The costs of using a notary are typically listed as part
of the average buying (or closing) costs in a particular country (as a percentage of the value of the property). They can vary from 0.1% to nearer 2% in certain countries, whilst a lawyer’s fees will generally be another 1.5 to 2%. But a notary does NOT perform the same role as an independent lawyer, who will advise you on wider aspects of the purchase and act in your interests. So, even if you are told by an agent that you do not need to use an independent lawyer – and indeed, you don’t legally need one – ignore them. It could be the biggest mistake you could make, especially if trying to cut costs.
So how do their roles differ? Notaries are legal executives appointed by the state to rubber-stamp and oversee all property transactions, and to ensure that appropriate taxes generated by the transaction are paid. Note that some notaries will insist on you having a translator (or bilingual lawyer, see below) present, although this is highly advisable anyway so that you know what you’re signing. As offi cial government witnesses, they put the transaction on public record and ensure that the vendor and buyer are who they say they are (by checking ID). They will ensure that all the correct processes are observed when the title deeds are drawn up, but will not tell you if the contract’s terms are unfavourable to you. For this, you must use an independent property lawyer. Not using one is madness when you think you are operating in an alien country, with unfamiliar legal processes, in a language you probably don’t speak very well.
So, protect yourself by employing a bilingual lawyer who specialises in the purchase of property by foreigners in that specifi c locality.
You need someone who can do the legal legwork in preparation for the signing of contracts so that you are completely au fait with the terms prior to the appointment with the notary.
Your lawyer will obtain and translate the relevant documents for you, and they can also advise on potential issues in that region (especially land ownership/planning permission problems) to look into. Your lawyer can perform full research, or due diligence, on your behalf.
Thus they will check the planning licences and that the property is legally built, free from any liens (legal claims on a property by a third party) and encumbrances and advise you on inheritance law.
When appointing a lawyer seek recommendations from other buyers, or contact the AIPP, to fi nd someone who is completely independent.
Your lawyer will also act as a facilitator between the seller’s and buyer’s banks, estate agents, and the notary offi ces. On the day that signatures are exchanged before the notary, your lawyer will check the draft of the deeds, which are drawn up by the notary’s offi ce. He or she will also coordinate payments and the cancellation of charges, usually the mortgage. And once the notary’s role has ended, your lawyer still has work to do, including satisfactory compliance with tax affairs and making sure the title deeds are registered at the Land Registry.
Despite slight variations in different countries as to their precise roles, a notary acts on behalf of the state and the law, while a lawyer acts on behalf of his or her clients. Using a qualifi ed and independent lawyer helps protect you in the purchase, prevents fraud, and provides legally binding security and, ultimately, peace of mind that the property you’ve bought is legally yours. You should not think about buying property overseas without one.
Top Tips
• ALWAYS seek comprehensive, independent legal advice when purchasing property overseas
• Ask you lawyer to advise you on the purchase contract before signing, and perform due diligence such as checking planning permissions and land title
• Consider the costs of a lawyer as an essential part of the purchase. It could prove much more costly to proceed without one
AIPP CONSUMER GUIDE 21
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