Legalities Bulgaria
There are various formalities that must be completed when purchasing a property in Bulgaria. It would be better for you to contact a special agency to get all necessary information.
When you have found a property you wish to buy, it is essential for you to sign a reservation agreement with the seller/developer, and pay a non refundable reservation deposit of €3,000. This agreement is similar to an “option to buy” contract in the U.K. and Ireland. It proves that the property has been taken off the market, fixes the price and you are in a position to buy it. At this time we will appoint an English speaking lawyer from our panel to manage your affairs.
The Search Process
When the property is reserved with a reservation agreement, we usually have between 10 and 15 days to conduct due diligence on your property with regards the land register and legal issues. This is done in order to verify if the title deeds for the property are satisfactory, and if the person selling the property is authorised to transfer his or her ownership.
We also do a search in order to guarantee that the property is free from any pending charges, mortgages or debts. If there are any pending charges on the property, we will take the appropriate measures to ensure it is completely settled before the legal ownership is transferred to you.
If you are buying a plot of land, a survey of the land can be carried out, in order to obtain its exact measurements and to identify its borders. This study will include details on whether the land has been classed as ‘buildable’, on its access points and on its surface.
Likewise, it will provide information on the different building possibilities and on the ‘buildable’ area, including a detailed plan, which will form part of your final title deed. If you are buying a property with land, it will be necessary to set up a limited liability company LLC (with the suffix OOD in Bulgaria).
This is not necessary when purchasing new build, apartments or “off plan” properties without land.
In case of setting up the LLC (OOD), we will organise the whole process and requirements related to the registration. We also carry out a survey of the land, which will ascertain whether the land has been classified as regulated. It will also include a detailed plan that will be part of your final title deed.
If we are dealing with properties in a building phase, we will ensure that the developer meets all appropriate legal requirements: building license (with a detailed search made in the architectural department of the correct municipality) and land survey (making sure that the work is taking place on regulated land).
As part of our process, we do searches on the reputation and solvency of the builders/developers and obtain agreements that the property will be built and handed over as detailed in the terms and conditions established.
Preliminary or Private Purchase Contract
Once our searches on the property have been made, and after guaranteeing that the legal situation of the property allows the sale to take place; with the signed instruction you have given with your deposit we can sign the Preliminary Purchase Contract (sometimes called the Private Purchase Contract) on your behalf. The Preliminary Purchase Contract is an important document containing information on the buyer and the seller, the price of the sale, the method of payment, the date the contract is formalized and the date you take possession of the property. We will advise when you should sign. This is normally no more than two weeks from reservation.
Once both parties have signed the Preliminary Purchase Contract and the deposit has been paid, the contract becomes a legally binding document.
The deposit amount and stage payment structure varies from developer to developer.
Signing the title deed
The property sale process is finalised before a Notary, with the buyer and seller signing the Deed of Sale. The Notary is a public official, whose duty consists of identifying the buyer and the seller, ensuring that all legal requirements have been met and that the amount due to be paid has been settled. If you are unable to be present in the finalising of the deeds, we take care of this by means of a power of attorney, which will allow your lawyer to carry out all necessary procedures in your name. It is common practice to have a valid power of attorney during the purchasing process.
Immediately after the deeds have been signed, the buyer is handed the keys, and takes possession of the property.
Final Title Deed & Property Registration
The property registration procedure entails the payment of all the taxes
applicable to the property and obtaining the final register stamp for the Title Deeds, which guarantees the transfer of the property. This important procedure takes place just after you have taken possession of your property.
Utilities
After the sale has been finalised, your lawyer will ensure that all the property’s utility contracts (electricity, water, rubbish collection, etc.) are in your name. We will also arrange all your bills to be paid by direct debit from your Bulgarian bank account (see next page).
Signed Instruction And Power Of Attorney
With a signed instruction we can sign the Preliminary Purchase Contract on your behalf. However, in order to complete your purchase will need a power of Power of Attorney to sign title deeds. We will draft the Power of Attorney, which can be signed, at your convenience, in Bulgaria. If you live in the UK or Ireland, we will be able to make the necessary arrangements for you to obtain the Power at the closest Notary’s office to your home; this would include the subsequent stamp of, “Apostle of The Hague” which the Power requires in order to be valid in Bulgaria. We can organise everything on your behalf.
Bulgarian Bank Account
It is essential to have a Bulgarian bank account in order to contract utility services and to pay them by direct debit. Your lawyer will take care of opening a bank account for you in Bulgaria.
Bulgarian Will
Please bear in mind Bulgarian Inheritance Tax. This tax is due to be paid in “mortis causa” property ownership transfers and to be aware of the ways of mitigating its effects. It is important to have a Will over your new property within Bulgaria. This Will is treated separately from any other Will’s you may have. Your lawyer can take care of the whole process.
Signed Instruction And Power Of Attorney
With a signed instruction we can sign the Preliminary Purchase Contract on your behalf. However, in order to complete your purchase will need a power of Power of Attorney to sign title deeds. We will draft the Power of Attorney, which can be signed, at your convenience, in Bulgaria. If you live in the UK or Ireland, we will be able to make the necessary arrangements for you to obtain the Power at the closest Notary’s office to your home; this would include the subsequent stamp of, “Apostle of The Hague” which the Power requires in order to be valid in Bulgaria. We can organise everything on your behalf.
Bulgarian Bank Account
It is essential to have a Bulgarian bank account in order to contract utility services and to pay them by direct debit. Your lawyer will take care of opening a bank account for you in Bulgaria.
Bulgarian Will
Please bear in mind, Bulgarian Inheritance Tax. This tax is due to be paid in “mortis causa” property ownership transfers and to be aware of the ways of mitigating its effects. It is important to have a Will over your new property within Bulgaria. This Will is treated separately from any other Will’s you may have. Your lawyer can and will take care of the whole processon your behalf.
