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Buying Step by Step in Germany
Each real estate investment consultant at IMOINVEST International goes above and beyond the call of duty to help you with all the legal and financial aspects related to buying your German investment property. Giving each investor a guide to understanding buying real estate step by step in Germany, we will take you through the purchase process with firm guidance that comes from experience. This includes discussing with you all aspects of buying in Germany, such as loan financing, purchase tax, real estate commission and the sale of property. We make purchasing real estate in Germany easy and enjoyable.
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Chances are you have never bought real estate in Germany before and have many questions regarding the process and legalities. The following text will help to understand the details in practical terms.
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Finance the Property
In Germany the buyer needs to present a so-called "irrevocable acceptance" of loan financing before signing the Notary contract, or if the buyer has the cash deposit, he/she must offer proof of the existing funds.
Review the Paperwork
Next, the Deed of Purchase and any accompanying papers (such as the official declaration of partition) should be reviewed. If the contracts are not in English and you are not German-speaking, it is better to have a professional translation completed. Your local Embassy can provide these services.
Set the Date
After the buyer has reviewed the documentation, it is time to set the date for signature of the Deed. At the Notary meeting, all buyers must be present, and show their legal papers (valid passports). If the buyer is a company, the person(s) signing the contract need to bring their legal papers from the company (authorization and an excerpt from the Chamber of Commerce entries showing the authorization status) plus passport.
Sign the Papers
At this meeting the Notary Public will read the Deed aloud for both parties, and if a translator is needed, one will be provided. After making any changes or additions the Deed is signed by both parties and the Notary Public. This contract is irrevocable. It includes information such as the agreed-upon purchase and all conditions thereof, the day of payment, the day of handover to the new owner, any needed repairs or other actions to be completed by the seller, and any other specifications as needed. After signature, the Notary Public will perform application in the so-called "Grundbuch" (the land title register), without which no sale of property can be completed.
Pay the Fees and the Property is Yours!
Also at the Notary meeting, the real estate commission must be paid. This ranges between 3,5% and 6% of the buying price (including VAT) depending on where one is buying in Germany. Between two to four weeks after the buying contract is signed, the purchase tax must be paid. This is exactly 3,5% of the buying price stated in the contract. This tax must be paid on time, otherwise the tax office will not issue the clearance certificate - an important paper for transferring the possession from the seller to the buyer. Within the same period of time the fee for the notary and registration must be paid (about 2 to 2.3 % of the buying price). The terms of the contract can be very variable, which is why the contract needs to be reviewed carefully.
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