To purchase real estate, it is indeed necessary to conclude a purchase-sale agreement, which can be drawn up yourself or entrusted to a notary. Latvia’s sworn notaries tell more about what are teh most frequently asked questions of citizens in connection with concluding a contract and securing property in the land register, and also why it is recommended to delegate the drawing up of a purchase contract to a specialist.
Does the amount of the purchase contract have to match the value of the property or item?
Sworn notary Baiba Skreba states that according to Article 2002 of the civil Law, a purchase is a contract by which one party promises to return a certain thing or right to the other for the payment of an agreed sum of money. Such a contract serves as proof of the amount for which the property has been sold. The sale amount is an essential part of the contract. It must be specified in the contract, and the sale amount must be true and appropriate.At the same time, Article 2015 of the Civil Law states that it is not necessary for the purchase price to exactly correspond to the value of the purchase item. The contract remains valid even if the item has been sold below or above its true value (friendship purchase). However, if the purchase price is set very low, for example 1 euro, then the contract is not considered a purchase, but a gift, which provides for other obligations.
Can the purchase contract be disputed during the inheritance?
Sworn notary Sandra Romāne emphasizes that an able-bodied real estate owner has the right to act as he sees fit with his property during his lifetime, including selling it and doing with the obtained money as he sees fit. When concluding a notarial deed – a purchase contract with a sworn notary, a sworn notary ascertains the legal capacity, will and terms of the transaction of the participants of the notarial deed, introduces the participants to the possible legal consequences of the transaction, and the notary also checks weather the transaction is genuine or whether the true value of the transaction is indicated. If the purchase price is appropriate for the real estate, the entire purchase price is paid to the seller, and the parties involved have legal capacity, then there is no reason to contest the purchase agreement after the seller’s death.
Is the purchase agreement enough to establish the right to the property?
The conclusion of the purchase agreement alone does not create ownership rights to the purchased real estate, according to sworn notary Dzintra Zitmane. In accordance with the provisions of Article 994 of the Civil Law, only those who are recorded in this very way in the land register can be recognized as the owner of real estate. The obligation of the acquirer of real estate to establish property rights in a timely manner in the land register is determined by Articles 1, 993, 994 and 1477 of the Civil Law. Legally, until the status of the new owner is indicated in the land register, the owner of the apartment is still the seller. A sworn notary can support the parties to the contract and take all the necessary actions to consolidate property rights. In addition, as the sworn notary Kristīne Malta-Grigule emphasizes, if the contract is concluded with a notary in the form of a notarial deed, it will also be kept in the files of a sworn notary.
What state fees should I expect when buying property?
When buying a property, you should expect that you will have to pay state and office fees. If the property is purchased by an individual, the state tax will be 1.5% of the purchase price or the cadastral value of the property, if it turns out to be higher than the purchase price. If the property is bought by a legal entity, it will be 2% of the purchase price or the cadastral value of the property, if it turns out to be higher than the purchase price, but in both cases no more than EUR 50,000. If a loan is taken for the purchase of the property, the state fee must also be paid for securing the pledge in the land register, which will be 0.1% of the amount of the main claim.
According to sworn notary Linda Eglīte, every property purchase transaction has its own circumstances, which can also affect the amount of the state fee, and it is best to clarify the current data with a notary. Normative acts also determine the amount of the office fee for each entry in the land register, including the confirmation of a new right (including the right of lien) in the amount of 15.00 EUR, but if the owner of the new document certifying property rights – the Land Registry Certificate – wants to receive a paper form, an additional 8.00 EUR will have to be paid.When buying a property, in addition to the already mentioned fees, you have to take into account the expenses for concluding the transaction and notarization, which are calculated in accordance with Cabinet of Ministers regulations no. 737 “Rules on remuneration fees for sworn notaries and the procedure for determining them”.
(Information prepared by the Latvian Council of Sworn Notaries)
– What role does a notary play in ensuring the legality of real estate transactions in latvia?
Interview between Time.news Editor and Notary Expert
Editor: Welcome to Time.news! Today, we have the pleasure of speaking with two distinguished notaries from Latvia, Baiba Skreba and Sandra Romāne.Thank you both for joining us!
Baiba Skreba: Thank you for having us!
Sandra Romāne: It’s a pleasure to be here.
Editor: Let’s dive right into it. Baiba, can you explain the importance of a purchase-sale agreement when it comes to real estate transactions in Latvia?
Baiba Skreba: Absolutely. In Latvia, a purchase-sale agreement is crucial as it serves as the legal foundation for the transaction. According to Article 2002 of the Civil law, it outlines that one party promises to transfer ownership of a property in exchange for payment. The amount specified must be truthful and accurate, which validates the transaction.
Editor: That brings us to an interesting point. Does the purchase price in the contract have to match the market value of the property?
Baiba Skreba: Not necessarily. Article 2015 states that the sale price does not need to correspond to the actual market value of the property. So, a contract is still valid even if the transaction occurs above or below market value.However, if the price is set extremely low—say at 1 euro—then it’s not considered a sale but a gift, which transforms the obligations involved.
editor: That’s a fascinating distinction! So, for potential buyers, it’s essential to be mindful of how they set the price in the contract. Sandra, I wanted to ask you about inheritance. If someone wishes to dispute a purchase contract during inheritance proceedings, what do you advise?
Sandra Romāne: This is an important aspect of property rights. An able-bodied owner can do what they wish with their property during their lifetime, including selling it. once the contract is signed and executed properly, it cannot easily be disputed in inheritance cases unless there are issues with capacity at the time of signing or proven fraud. Thus, ensuring the legality and clarity of the purchase agreement is vital.
Editor: So,it’s safe to say that having a professional,like a notary,involved can safeguard the interests of both the buyer and seller?
Baiba Skreba: Exactly! A notary ensures that all legal requirements are met and can help prevent potential disputes down the line. It really is wise to delegate this task to a professional who knows the ins and outs of real estate law.
Editor: Before we wrap up, do you have any final thoughts or tips for our audience considering entering the real estate market in Latvia?
Sandra Romāne: I’d say, always consult with a notary before making any decisions. They can provide guidance and ensure that everything is in accordance with the law, which will save you from future headaches.
Baiba Skreba: and remember, clarity is key in any contract. Don’t hesitate to ask questions or seek adjustments in agreements that don’t seem right to you.Weather you are buying or selling, knowledge is your greatest asset.
Editor: Thank you both for your insights! it’s been incredibly enlightening. For anyone interested in real estate transactions, the expertise of a sworn notary seems invaluable.
Baiba Skreba: Thank you for having us!
Sandra Romāne: It’s been a pleasure; thank you!
Editor: And to our readers, thank you for tuning in. We hope you found this discussion as informative as we did!