To buy a property in Italy can be a simple and safe process, if you are in the right hands. The process is here quite different from what you might have experienced in other jurisdictions, like the USA or the UK or other common law jurisdictions, but it must be absolutely a safe experience.
The Italian notary is the independent professional, appointed by the State, who is responsible for the good outcome of it. The notary is provided with a mandatory insurance policy, with a minimum coverage of Eur 3,000,000, while notary Steidl is covered by an excess insurance policy up to Eur 40,000,000. It is uncommon that the parties are assisted by their own lawyers, unless some outstanding issue raises, which needs to be negotiated between the parties; indeed, the notary cannot negotiate between the parties or deal with litigations, under the law. Nevertheless, as the notary is responsible for ensuring that transactions carried out with his assistance are conducted properly, it is clear that his focus will be on the buyer, who is usually the one who needs the most protection.
Here is a short description of the steps usually taken to complete the process.
- The first step is the Proposal of Purchase (Proposta di Acquisto). It is usually drafted by the real estate agent, signed by the prospective buyer and addressed to the seller. It summarizes all the main covenants of the future sale, like the price offered and down payments, the timing of delivery, the guarantees of the title to the property, etc.; it is customary to pay a little amount of money upon the offer, usually depositing it with the agent or the notary’s escrow account, just to demonstrate its seriousness. This amount will be part of the price should the offer be accepted or will be returned to the prospective buyer should the offer not be accepted.
- Once the seller has accepted the offer, as the case may be, it is possible to go straight to the closing, the Final Deed, which implies the payment of the balance. Sometimes there is the need for a second step, called the Preliminary Agreement of sale and purchase (Contratto preliminare di compravendita). Upon the signature of such preliminary agreement, it is customary to pay a substantial down payment that is usually between 10% and 30% of the full price. You can use the same escrow account of the notary, to transfer such amount to the seller. The notary in charge of executing such preliminary agreement carries out a due diligence on the title to the property and examines the survey of an appointed professional regarding the compliance of the property to the in force building and zoning regulations. In general, he will ask the seller for all the due documentation needed. Sometimes this second step is necessary because the seller needs to clear the property, to contact the moving company, etc., and this requests full commitment from the buyer, nonbeing sufficient the little deposit paid upon the offer.
- After the signing of the offer (or the preliminary agreement, as the case may be) the final step takes place, the final deed of sale and purchase, upon which the payment of the balance takes place as well as the delivery of the keys. The notary is usually the one who pays the price to the seller, after the buyer has wired the balance to his escrow account, and is also the one who cares about all the registrations, in order to make the property lawfully recorded in the name of the buyer.
If you need more information about the process of buying a property in Italy, please do not hesitate to contact our office.
