The French Notaire: What is their role?
With sole authority for drawing up final property sale contracts as well as mortgage contracts between individuals and banks, most people who invest in property in France will encounter a Notaire at some point during the proceedings. Notaires hold an unusual status as independent, self-employed legal specialist whose activities are heavily regulated by the government and whose job is to ensure that the law is upheld.
When to appoint a notaire
Potential property purchasers may not choose to consult a notaire during the early stages of their property acquisition, such as signing a preliminary contract, which can be done by any Estate Agent. However, it may be advisable to consult a notaire early in the process, even if it isn’t a legal necessity. They may prove to be a valuable source of information, not only about the house, but also the surrounding area. Later, when you’re ready to sign the final sale contract, you will certainly require the services of a notaire as they are the only authority in France with the legal power to draw one up. The same goes for mortgage contracts with the bank if you choose not to buy your property outright.
Choosing your notaire
It is possible to have the same notaire acting for both the seller and the buyer of a property, or the seller and the buyer may each choose a separate notaire. In both cases, the notaire is an independent official who is there to ensure the law is applied correctly. They do not represent the buyer or the seller’s interests. In addition, the fees paid do not change depending on the number of notaires. The whole fee is paid either to one notaire in its entirety or is shared between the two. When choosing a notaire, note that there is no restriction on a notaire’s jurisdiction, but it is usually prudent to choose someone who usually operates within the area where your property is located.
How much will it cost?
Notaire’s fees are government regulated and are calculated on a fixed national scale as a percentage of the property’s sale value. In practice, this usually translates to around 8% of the sale value of an old house and 2-3% of the sale value for a new property. The fees are also subject to VAT at a flat rate of 20%.
What’s included in a notaire’s fee?
The name “notaire’s fee” is actually something of a misnomer. The entire fee paid to the notaire is actually more accurately a “completion cost”, which comprises of many other payments besides the salary of the notaire. Anything up to 80% of the fee may in fact cover taxes and duties paid to the government; it simply falls to the notaire to collect the fees on the Treasury’s behalf. The fee also include various expenses for other professionals involved in the property sale process as well as the notaire’s actual fee, which accounts for about 10% each.
Beyond the French notaire
From a legal perspective, a notaire is all that is strictly necessary for completing the formalities of buying your French property. However, many investors also choose to consult a legal professional in their own countries with specialist knowledge of French property, to ensure that they have a comprehensive understanding of the situation. As an alternative, investing with a property management company is one way to ensure that the legal formalities and obligations are being expertly handled with a minimum amount of complex paperwork for the individual property buyer.
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