Here's a situation: you're browsing Craigslist looking for a flat or a house. You only see properties that don't suit you, until you fall in love at first sight.
Yes, you know, the one that makes you go to the banker the moment you set eyes on it. You can't wait any longer, this real-estate property is important to you and every minute counts. This is where the sales agreement comes in.
The preliminary sales agreement: an act to speed up the purchase of a property
What is the sales agreement?
This is a preliminary contract in which the seller and buyer agree on the conditions of a sale. They undertake to conclude the deed at a price fixed together. The compromise has the same legal value as a sale. If one of the parties renounces the agreement, the other party can force it through the courts by demanding damages.
Why use this contract?
There are two reasons why parties may want to make a purchase and sale agreement:
- Protection of the seller in the event of renunciation: once the deed is signed, the buyer pays a deposit (commonly known as a security deposit) of between 5 and 10% of the sale price. This will be deducted at the time of notarisation.
- No tax costs: the compromis de vente does not need to be registered with the tax authorities. This represents a cost advantage.
Suspensive clauses for a less binding compromise
When drafting the preliminary sales agreement, the parties may decide to include suspensive clauses. These clauses are there to protect the buyers or sellers if certain events occur after the sale of the property, such as
- A refusal by the bank to grant a mortgage to the buyer,
- A right of pre-emption by the commune: this is a priority right of purchase for the commune,
- A town planning easement: these are charges existing against a property aimed at limiting or prohibiting the exercise of the owner's rights over his property.
In such cases, the deposit paid by the buyer is returned.
Another clause can also be included in the provisional sale agreement, namely the forfeiture clause. This stipulates that the purchaser may renounce the purchase of the property subject to paying a certain sum agreed in advance to the vendor.
This clause is different from the penalty clause, which stipulates that the buyer must pay a lump sum as damages to the seller if he refuses to sign the sale.
Why use the electronic signature to sign your sales agreements?
The advanced electronic signature to sign your documents
The eIDAS regulation has defined three levels of signatures:
- Simple electronic signature,
- Advanced electronic signature ,
- Qualified electronic signature.
In the case of the preliminary sales agreement, the advanced electronic signature will be used. It requires more verification than a simple signature. Here, the signatory will have to prove his identity before being able to sign.
As the preliminary sales agreement is a pre-contract leading to a property sale, the identity of the signatory must be known.
The advantages of signing your sales agreements electronically
When signing certain documents, several signatories may be involved. This poses several problems:
- It is difficult to bring together the people involved at the same time due to a busy schedule.
- If the compromise is signed remotely, without an electronic signature, the only valid and legal way would be to send the documents to be signed by registered mail: a waste of time for all parties.
By using the electronic signature, you will benefit from several advantages:
- Quicker signing: The signatories can sign the compromis in less than 2 minutes after identity verification.
- Time saving for the sale: The less you have to wait for the various parties to sign, the faster the sale will be completed.
- The period of suspensive clauses starts earlier: if a problem arises after the signing of the deed, the property can be put back on the market immediately
As you can see, the use of electronic signatures for your preliminary sales agreements will change the way you acquire a property. Notaries already use digital signatures, why not you?
This document is provided for information purposes only. We do not guarantee their completeness, nor do we guarantee that they are up to date and compliant with the applicable regulations. It is not a substitute for legal advice.