Explanation of purchase agreement
Congratulations, you are about to sign the purchase agreement. Because the agreement can be a comprehensive and often difficult document, we have written the explanation of the purchase agreement below. If there are any ambiguities in the agreement, the broker can always help you!
EXPLANATION OF THE PURCHASE CONTRACT FOR CONSUMERS*)
*) Attached to model purchase agreement for an existing single-family home (model 2023)
1. Model purchase agreement with explanatory notes.
The model sales contract for an existing single-family house has been agreed upon by Vereniging Eigen Huis, Vastgoedpro, VBO Association of brokers and appraisers and the Dutch Cooperative Association of Estate Agents and Appraisers NVM U.A. All four of these organizations use the same model contract.
The model purchase agreement assumes a kind of standard situation. Because no two situations are exactly alike, the purchase agreement can be adapted to specific circumstances. To this end, the parties involved in the transaction and their brokers can include additional agreements between the parties in the purchase agreement. Of course, the parties may also deviate from what is standard in the purchase agreement.
2. Purchase Agreement
If you are buying or selling a home, the arrangements are recorded in a purchase agreement. If you are buying or selling a home through a real estate agency, the real estate agent involved will assist you with this. It is always wise to enter into the purchase of a residence in writing, but in most cases it is even necessary. A verbal (sales) purchase of a home is usually not valid. After signing by all parties, the purchase agreement will be sent to the notary named in the purchase agreement. In most cases the buyer will have a reflection period. This cooling-off period will be discussed in more detail in the explanation of Article 16.
3. Deed of delivery
The notary draws up a deed of delivery based on the information in the purchase agreement. The deed of delivery is the legal elaboration of the purchase agreement already concluded, necessary to effect the actual transfer of ownership. This deed of delivery is first sent to all parties in draft form. The notary will invite you in good time to sign the deed of delivery.
On that day, the notary goes over the main contents of the deed of delivery with the buyer and seller. The deed of transfer is signed by the buyer, the seller (unless a power of attorney has been granted by the buyer or the seller) and the notary.
The notary ensures that the deed of transfer is registered in the public registers. At the moment of registration in the public registers, the buyer officially becomes the owner. This is processed in the land register. Later, the buyer receives a copy of this deed from the notary: the "proof of ownership."
Along with the draft deed of transfer, you will receive a "bill of settlement" from the notary. This bill includes (usually) the purchase price for the buyer, the settlement of charges, the transfer tax, the costs of the land register and so on. The seller's bill of settlement includes, among other things, the amount of any mortgage loan to be repaid with the associated costs. It is customary that the brokerage fees not already paid and the consultancy fees of any mortgage loan are settled at the notary. Brokerage fees are paid by the person who engaged the broker.
At the bottom of the bill is the amount that you, the buyer, still have to pay or that you, the seller, will receive or have to pay extra.
5. Energy Label
In principle, every seller is obliged to provide the buyer with a valid energy label when transferring ownership of the property. An energy label shows how energy efficient a home is and what could be improved. From the insulation of the roof, walls, floor(s) and windows to the energy efficiency of heating systems. If the seller does not have an energy label upon delivery, the seller risks a penalty.
There are some exceptions to the main rule that the seller must hand over a valid energy label when transferring ownership of his home. An exception is, for example, a protected monument. Your real estate agent can inform you about this. You can also obtain information on the website of the national government: www.rijksoverheid.nl
6. Explanation of purchase agreement
What follows now is a point-by-point explanation of the text of the purchase agreement.
On the cover sheet of the purchase agreement at A, the seller's details are filled in. Insofar as already known, the seller's future address and telephone number are also given; this is for the benefit of any further communication with the notary and the Land Register (for sending the deed of transfer, for example). If there is a co-seller, including a spouse or registered partner, their details are also entered under A.
At B the buyer's data are entered. Again, if there is a co-buyer, his data are also entered under B.
If the spouse or registered partner does not act as a co-buyer or co-seller, but signs the purchase agreement as an expression of consent, it is sufficient to include his or her name at the bottom of the deed.
Co-signature by spouse/registered partner
The Civil Code, Article 1:88 (1) (a) states:
"A spouse shall require the consent of the other spouse for the following legal acts: agreements purporting to alienate, encumber or occupy, and legal acts purporting to terminate the use of a dwelling occupied jointly by the spouses or by the other spouse alone, or of items belonging to such dwelling or to its contents."
Household effects" here means all movable property that serves as household effects and as furnishings for a home, with the exception of books and collections of works of art, science or history. If the other spouse is absent or unable to declare his/her wishes and therefore does not give his/her consent, the decision of the court may be invoked.
The same rules apply to registered partners as to spouses.
In implementation of what is provided in this section of the law, the spouse or registered partner of the seller must usually co-sign the purchase agreement for permission to sell. No consent is required under this article of law for the purchase of the buyer's spouse or registered partner; however, consent and countersigning is required for the establishment of a mortgage with respect to the property. The cover sheet shall indicate who the buyer(s) and seller(s) are.
Unmarried or registered cohabitants do not have to give each other permission to sell the home they live in together, but the cohabitation contract may have agreed otherwise. If cohabitants are joint owners, they do need each other's cooperation for the sale of the home.
Option Ownership / Leasehold.
This article should specify whether it is a purchase of a property in ownership or a purchase of a right of leasehold on a property. In the case of a purchase of an immovable property in ownership, the buyer becomes the owner of the plot of land with the dwelling on it. In the case of the purchase of a right of emphyteusis, the buyer does not become an owner, but a leaseholder of the land with the dwelling on it. Leasehold is a right that gives the leaseholder the authority to hold and use the land with the buildings on it that are owned by another person. Because another person is and remains the owner of the land with dwelling, there are conditions attached to the leasehold right and, in many cases, a fee ("canon") must be paid for the use of the land. These conditions are indicated in the Leasehold Option under Article 1.2. Articles 1.3 and 1.4 indicate exactly what the ground lease entails and the amount of the canon.
Details of the property are entered, such as the street, house number, municipality and cadastral data. The size of the land area is usually based on the data given in the public registers. These data may differ from the actual situation, see Article 6.11. Finally, the purchase price is entered, first in numbers and then written in full.
List of cases
The purchase agreement also includes a list of items. The list is intended to record what is included in the purchase. It includes both movable and immovable items. If the buyer and seller do not clearly agree which items are included in the purchase, this can lead to problems. For example, the buyer may argue that the front fireplace is included in the sale, while the seller has a very different opinion. If the parties disagree about what exactly is included in the sale, they sometimes have to cut the Gordian knot using the legal distinction between movable and immovable property. However, that distinction is often difficult to handle - even for lawyers. To prevent buyers and sellers from having to navigate a legal maze, the list of items has been prepared. It is wise to go through the entire list together. Of course, things can be added to or removed from the list.
Valuation of movable property
The list of items prevents discussion of what is and is not included in the purchase. This does not mean that parties no longer need to look into the distinction between movable and immovable at all. That distinction can be important for both buyer and seller for tax reasons. For the transfer of immovable property, for example, transfer tax must be paid. For the transfer of movable property, this is not the case. On the other hand, interest expenses related to the purchase of movable property are not deductible for income tax purposes. Moreover, the proceeds of the property may affect the amount the seller can borrow in the future while retaining mortgage interest deduction.
The purchase contract will state the amount at which any moveable property sold with the property is valued. If movable property that has been co-sold is actually valued, the notary must indicate in the deed of conveyance which items are concerned, the amount for which they were acquired and whether that amount is included in the price for the property.
Of course, the amount entered for movable property must be real. The tax authorities can check this and ask for further clarification. If the amount is not in proportion to the actual value of the movable property in question, the buyer runs the risk of an additional tax assessment and a fine.
Since the notary usually does not have a concrete picture of the sold property, it is pleasing to the notary if the list of items indicates which items are movable according to the parties. By the way, whether something is movable or immovable follows from the law. So the parties can negotiate about what is included in the sale (list of items), but not about whether the items sold with the sale are movable or immovable.
This article specifies who pays the costs: buyer or seller. If the seller pays these costs, it is called "v.o.n." (freehold). If the buyer pays these costs, we speak of "k.k." (costs-to-buyer). (buyer's costs). These costs include notary fees for the deed of conveyance (including VAT), land registry fees and transfer tax.
It does not include brokerage fees and mortgage costs, among others! It is separately stated which costs charged by the notary will be borne by the seller or buyer. The transfer tax is a percentage of the purchase price. If the value of the property is higher than the purchase price, the transfer tax is calculated over this value.
There is a chance that sales tax (VAT) will be due on the purchase price. For example, if there has recently been a renovation, or if a practice room is included in the sale. It must then be clear who will pay this VAT. With new construction, VAT is usually included in the purchase price. Your real estate agent can inform you about this.
Article 2.2 applies if the seller sells and transfers the immovable property within a certain period of time after the seller becomes the owner. At the time this model was drafted, the specified period under Article 13 of the Law on Taxation of Legal Transactions (hereinafter "WBR") was six months. Pursuant to Article 13 paragraph 1 WBR, the amount on which transfer tax or sales tax was due in respect of that previous acquisition may be deducted from the tax base. This is also referred to as the 'basis reduction'. A transfer tax advantage then arises due to the redelivery of the immovable property within a certain period of time, to which the buyer is entitled pursuant to Article 13 WBR. If the seller wishes to make use of this advantage, the seller must agree this with the buyer during the negotiations. In Article 2.2, "not" is then crossed out and the buyer then pays the seller this benefit as compensation.
Previously, it was approved that this consideration to the seller was not subject to transfer tax. This approval expired on July 1, 2011. Since then, the compensation paid by the buyer to the seller has again been included in the consideration and must therefore also be subject to transfer tax. The last sentence of Article 2.2 stipulates that the buyer never pays more transfer tax than the buyer would have paid if there had been no resale pursuant to Article 13 WBR. The disadvantage arising from the expiry of the approval is therefore borne by the seller.
Article 13 paragraph 4 WBR provides that, in deviation from Article 13 paragraph 1 WBR where a yardstick deduction applies, not the yardstick, but the tax due in respect of the previous acquisition can be deducted from the tax due on the acquisition of the home within six months of the previous acquisition. Allowing a tax deduction instead of a basis deduction in these situations prevents the deduction from exceeding the accumulation of tax. The application of Article 13 paragraph 4 WBR does require that the reduced rate mentioned in Article 14 paragraph 2 WBR has been rightly applied. In principle, Article 13 paragraph 4 WBR only applies if, due to unforeseen circumstances, the residence was not reasonably or temporarily used as the principal residence within six months after the acquisition.
Example transfer tax (The example is based on the legal transfer tax rate applicable at the time this model was created)
Non starter B acquires a house for € 350,000 and pays 2% transfer tax on it (2% of € 350,000 is € 7,000). B will live in the house for a very short time, but, due to unforeseen circumstances, transfers the house to K for € 360,000 within six months. K will not or only temporarily use the home as his main residence and therefore does not qualify for the exemption or the reduced rate of 2%. K therefore, in principle, owes € 37,440 (10.4% of € 360,000). However, pursuant to Article 13 paragraph 1 WBR, K can reduce the taxable amount by the value on which transfer tax has already been paid (€ 350,000). As a result, K would owe only 10.4% transfer tax on €10,000 (€360,000 minus €350,000). This is €1,040. The tax benefit for K due to B's short-term occupancy of the property amounts to €36,400. But Article 13 paragraph 4 WBR ensures that the benefit cannot exceed the amount due in respect of the previous acquisition at the 2% rate. K can therefore only apply a reduction of €7,000 and owes €30,440 (€37,440 minus €7,000). If the parties agree in Article 2.2 that the buyer will pay the saved transfer tax - also called the Article 13 difference - to the seller, the buyer will pay the seller this benefit of €7,000 as compensation. In the third sentence of Article 2.2, the buyer and seller have agreed that the transfer tax due on the Article 13 difference will be deducted from the Article 13 difference to be paid to the seller, so that ultimately, in this example, the seller is entitled to compensation of €6,340.58 (€7,000/110.4 x 100). The amount of € 659.42 is the transfer tax due on the Art. 13 difference. This ensures that the total amount the buyer pays in transfer tax plus the Article 13 difference to be paid to the seller will be equal to the amount the buyer would have owed in transfer tax without application of Article 13 WBR.
The notary receives the purchase price from the purchaser and - after first paying the seller's creditors, including mortgage lender(s) and distraining creditor(s), who should be paid from the purchase price in connection with the correct completion of the sale and delivery in accordance with the professional and policy rules applicable to the notary - pays the remainder of that purchase price to the seller. Because the notary must ensure that the sold property is unencumbered by, for example, mortgages or attachments upon registration in the public registers and the notary only receives official confirmation of this after the date of delivery, the notary may - also for insurance purposes - only pay out the purchase price on behalf of the purchaser once the notary has this confirmation, usually several days after the date of delivery.
There are different types of transfers. The most important are the legal transfer and the actual transfer. The legal transfer (also called legal delivery, transfer of ownership or conveyance) takes place at the notary through a notarial deed of delivery and its registration in the public registers. The actual transfer takes place by handing over the keys and taking possession of the property sold. There may be two dates for the different transfers (see Article 7), but often the two dates coincide. In Article 4, enter the date of the legal transfer. When the actual transfer precedes the legal transfer, there may be a transfer of beneficial ownership. In that case, it may be wise to contact the notary in connection with possible transfer tax liability. This article also enters the name of the notary office that handles the deed of transfer. The choice of notary usually lies with the buyer, except if the seller announces before the conclusion of the purchase agreement, to reserve the choice of notary. This often happens with new construction to have the entire project delivered to the same notary.
Because the model purchase agreement allows for 2 types of purchase - namely the purchase of the ownership of the real estate or the purchase of the right of leasehold on the real estate - it has been indicated how the terminology in the purchase agreement should be read.
It is customary to agree that the buyer will provide a bank guarantee in the amount of 10% of the purchase price after the sales agreement is concluded. This is a statement from the bank guaranteeing that the bank will pay this amount if the buyer fails to meet his obligations. Setting up a bank guarantee takes some time. Usually the bank guarantee is issued within a few days of the expiration of the financing reservation. The bank charges a fee for a guarantee statement.
Instead of providing a bank guarantee, the buyer can deposit a security deposit. It is common and prudent to deposit any deposit with the notary. If the buyer is buying as a consumer, by law the deposit or bank guarantee often cannot exceed 10% of the purchase price.
Article 5 aims to provide seller with a certain security that buyer will fulfill its obligations. If necessary, the penalty mentioned in Article 11 can be recovered from the bank guarantee or deposit. If the deposit is of any size or is not already in the notary's possession for a short period of time, the notary will usually pay interest to the buyer.
Article 6.1 states that the buyer buys the immovable property in the condition it is in at the time of entering into the purchase agreement. The main rule is that, in principle, the seller does not guarantee the absence of (hidden) defects. In other words, ownership of the immovable property will be transferred to the buyer including all visible and invisible defects. All risk is therefore initially placed on the buyer. This applies to both actual defects and other defects insofar as they are not to be regarded as 'special burdens' within the meaning of Article 7:15 of the Civil Code. Article 6.2 deals with those 'special burdens'.
Given the main rule that all risk rests with the purchaser in the first instance, the purchaser is required to carry out a certain amount of research. For example, the purchaser must, in principle, find out from the municipality what use/function rests on the immovable property under the zoning plan/environmental plan in force on the site. However, the seller must provide the buyer with the information known to the seller: in principle, therefore, the seller must tell the buyer what the seller knows about the properties and (actual) defects of the immovable property.
Article 6.3 makes an important exception to the above-mentioned main rule that all risks rest in the first instance with the buyer, insofar as the actual properties of the immovable property are concerned. This exception is discussed in detail below in the notes to Article 6.3.
Article 10 further addresses the situation where the immovable property cannot be delivered in the condition it is in at the conclusion of this purchase agreement because the property was lost in whole or in part after the purchase - but before delivery.
The real estate is delivered free of mortgages, attachments and registrations thereof. The seller must pay off the existing mortgages and ensure that they are also no longer registered in the public registers. In practice, the notary arranges the latter. The seller also ensures that there are no attachments on the property. Should there be an attachment on the immovable property, the delivery cannot usually take place until the attachment is lifted.
Article 6.2 deals with 'special charges and restrictions' resting on the immovable property (a term derived from Art. 7:15 of the Civil Code). 'Special charges and restrictions' (hereinafter: 'special charges') are legal restrictions resting on the immovable property. These can be private law restrictions such as (suffering) easements, qualitative obligations and so-called 'chain clauses'. Based on such restrictions, another person (than the owner) has a claim on the immovable property (for example, a right of way over the land). It may also involve public law restrictions such as a decision to establish a municipal preferential right. The seller must inform the buyer prior to the sale about the legal restrictions that rest on the immovable property as 'special charges'. To this end, the Seller shall provide the Purchaser with (copies of) the (previous) notarial deeds in the Seller's possession. The Buyer can then read in these deeds which special encumbrances rest on the immovable property. It follows from Article 6.2 that the Purchaser (explicitly) accepts the special burdens arising from these deeds.
If the seller is aware that there are (also) special encumbrances on the real estate which are not apparent from the deeds made available to the buyer, then the seller will have to notify the buyer of these special encumbrances, so that the buyer is aware of them when the purchase agreement is concluded. For restrictions under public law (resting on the immovable property as a special burden), these are by no means always mentioned in previous notarial deeds. Public law restrictions with which the Seller is familiar may be explicitly mentioned in Article 6.2. The Purchaser (explicitly) accepts the restrictions mentioned in Article 6.2.
It is important that the seller tells the purchaser what the seller knows, and that the purchaser knows, on the basis of what is stated in Article 6.2 and the previous notarial deeds (copies of which have been provided to the purchaser), what special charges (under private and public law) rest on the real estate. If the seller fails to provide the information, the seller may later face a claim for damages. Because the special charges concern claims of others on the immovable property, the seller will often not be able to lift these charges (or only with great difficulty). If removal proves impossible, the buyer will in principle be able to claim damages from the seller. It is therefore important that the seller tells the buyer which special charges rest on the real estate (so that these can be accepted by the buyer).
Article 6.3 provides a far-reaching exception to the main rule that ownership of the immovable property will be transferred to the buyer including all visible and invisible defects. Article 6.3 stipulates that the immovable property will, upon transfer of ownership, possess the actual properties required for normal use. Normal use for a property means, among other things, that the property must be able to be lived in safely and with a certain degree of durability. If a defect hinders normal use, the buyer can hold the seller liable. However, it does not mean that every defect hinders normal use. The buyer of an existing home will, depending on its age and price, to some extent have to take into account a certain degree of immediate (overdue) maintenance and adaptations to the requirements of the time, even if the need for this was not immediately apparent at the time of the conclusion of the sale. In addition, Article 6.3 stipulates that defects that impede normal use and are "known" or "knowable" to the buyer at the time of the conclusion of this purchase agreement will be at the buyer's expense and risk. An example. Seller sells a home with rotted roof sheathing. It has been determined that the rotted roof boarding is interfering with the normal use of the home. Buyer is aware of this when the purchase agreement is signed. Buyer cannot sue seller after signing the purchase agreement because the "normal use" in Article 6.3 is obstructed by the rotted roof boarding. After all, at the time the purchase agreement was signed, the buyer was aware of this, and the parties have agreed that defects which hinder normal use and which are known or knowable to the buyer at the time the purchase agreement is concluded will be at the buyer's expense and risk. The term "knowable" is broader than "known." Even defects which are not known to the buyer but which the buyer should have discovered if the buyer had exercised sufficient care are "known". So the buyer cannot simply assume that everything is in order. The buyer is expected to ascertain - or have ascertained - whether the item meets the buyer's requirements. The saying "what you don't know won't hurt you" does not apply here. If in doubt, the buyer must ask questions and/or carry out his own investigations or have them carried out. This does not mean that the seller can always keep his mouth shut. The seller has a duty of disclosure. The seller must inform the buyer of defects which the seller should know are important to the buyer and which the seller knows or suspects that the buyer is unaware of.
This duty of disclosure is not limited to the aforementioned defects. If the buyer has indicated that the buyer wishes to use the real estate for a special purpose, if the seller knows that the sold property is not suitable for that use, the seller will have to notify the buyer. Although it follows from Article 6.3 that the seller does not vouch for the suitability of the sold property for its intended special use, the seller does have a duty of disclosure. If seller does not fulfill the duty of disclosure, buyer -if he did not know about the defect- can hold seller liable.
The saying "what you don't know won't hurt you" does not apply to the seller either. If, despite adequate investigation by the buyer, it subsequently transpires that at the time of the transfer of title there was a defect that prevents normal use, the seller can in principle be held liable. This also applies to soil contamination. If both the seller and the buyer are completely unaware of the presence of soil pollution, then if the normal use of the real estate is at issue, the risk will in principle rest with the seller. If contamination does not prevent normal use, the risk will in principle rest with the buyer.
The seller's obligation to deliver a good that possesses the properties required for its normal use also applies, in principle, to the co-sold (movable) goods. In that case, too, the seller must inform the buyer about defects that impede normal use and which are not immediately perceptible to the buyer. If the buyer himself has reason to doubt, the buyer must ask the seller questions or examine the co-sold item (or have it examined).
The second-to-last sentence of Article 6.3 deals with repair costs. For defects hindering normal use which were not known or known to the Purchaser at the time this purchase agreement was concluded, the Seller is only liable for the repair costs. The seller bears the risk of making the real estate suitable for normal use. When determining the repair costs, the deduction 'new for old' must be taken into account. When determining the 'new for old' deduction, the costs of renewal on the one hand and the lifespan of the part to be replaced on the other are taken into account. An example: the buyer has held the seller liable under Article 6.3 of the purchase agreement for a non-functioning central heating boiler. The central heating boiler needs to be replaced in its entirety. A central heating contractor has estimated the cost of replacing the central heating boiler at € 2,500.00. The expected lifespan is estimated at 20 years. At the time of purchase, the central heating boiler was 10 years old. The deduction "new for old" amounts to 50%, namely € 1,250.00. The seller must therefore pay half of the repair costs to the buyer.
The buyer bears the risk of the other (consequential) damage, unless the seller is at fault. Seller is at fault if, for example, seller knowingly conceals defects that impede normal use.
Clause 6.4.1 allows the parties to state their knowledge of whether or not the property is contaminated. Such a clause is referred to as a '(dis)knowledge statement'. Articles 6.4.2, 6.4.3, 6.4.4, 6.7.1 and 6.7.2 are also examples of (un)knowledge declarations. Such clauses have an evidential and a signaling function. The evidential function lies in preventing "yes-no discussions." For example, if the buyer declares that the buyer is aware of the presence of an oil tank (declaration of familiarity), it is difficult for the buyer to claim afterwards that the seller has neglected his duty to give notice of that presence. It is clear from the sales contract that the presence was known. Conversely, if the seller declares that he was not aware of the presence of an oil tank (declaration of unfamiliarity), it is difficult for the seller to claim in retrospect that the seller informed the buyer of the tank's presence or that the presence of the tank was clearly visible to the buyer. After all, it is stated in black and white that seller did not know whether there was an underground tank. The signal function is fulfilled because the parties are made aware of the issue. They are more or less forced to record something about it. This encourages the seller to fulfill his duty of disclosure and the buyer to fulfill his duty to investigate. In order to avoid any misunderstanding, Article 6.13 explicitly states that a disclosure statement is not intended as a guarantee or exclusion/limitation of liability. As indicated above, the saying "what you don't know won't hurt you" applies neither to the buyer nor to the seller. Whether or not the buyer can hold the seller liable follows in principle from Articles 6.1 and 6.3 of the purchase agreement, whereby known defects are at the buyer's risk. The parties can, of course, deviate from the standard allocation of risk in the purchase agreement on a case-by-case basis.
Article 6.4.2. covers underground storage tanks for storing (liquid) substances, such as oil tanks and septic tanks. In particular, special rules apply to the use and remediation of underground oil tanks. The seller can indicate whether the tanks are still in use, whether they have been decommissioned, if so, when this was done and whether the legal requirements were observed in the process. If an unoccupied oil tank has not been disabled, the buyer and seller would be wise to make arrangements for the remediation or removal of the tank and the associated costs. Such agreements can be recorded in the open space left below the article. If the seller does not know whether oil tanks are still present, the buyer would be well advised to research the presence of oil tanks in advance. If there is a tank in the garden that has not yet been remediated or not in accordance with the Decree on activities in the living environment, the competent authority may impose an obligation to (re)remediate or remove the tank. This first requires a soil investigation into possible soil contamination that may have occurred as a result of an oil spill and which requires the soil to be remediated. The method of remediation depends on the degree of contamination and must be done by a licensed remediation contractor.
Section 6.4.3 requires the seller to disclose whether or not the seller is aware of whether or not asbestos has been incorporated into the property. This also applies if, for example, in a shed or shed roof or in the paving of a garden path, asbestos has been used. When removing asbestos, special measures must be taken. If asbestos has been found, the parties can, if they wish, include in the purchase agreement whether, and at whose expense, it will be removed. Again, if the seller does not know if asbestos has been incorporated into the house, the buyer can have it investigated.
Article 6.4.4. deals with land restriction decrees. If the seller knows that such a decision has been made, the seller must notify the buyer.
Article 6.4 lists a number of common cases. This is not an exhaustive list. Depending, for example, on the age of the house and/or the region where the house is located, other matters may also be important for the buyer to know. Consider the risk of flooding, foundation problems, the presence of lead pipes and/or the presence of cotton wiring. For buyers, it is wise to review the questionnaire that the seller (usually) has filled out. This contains a lot of information about the house and the lot. By the way, this questionnaire is not exhaustive. The questionnaire is not intended to give any guarantees, but it is of great significance for the interpretation of the agreement and, in particular, for what the buyer can expect. The questionnaire has an informative character and is an aid for the seller to fulfill his obligation of disclosure.
It follows from Article 6.5. that the purchaser may inspect the immovable property inside and out immediately prior to the execution of the deed of transfer at the notary. It was decided to do this just before execution of the deed of conveyance, because this is the best time. All sorts of things can still change about the property. Therefore, here is another opportunity to check that the real estate is in the same condition as when it was purchased. If a real estate agent is involved in the sale of the property, they will often be present at the inspection.
Article 6.6. deals with so-called notices issued by the government or by utility companies. The government or a utility company can impose an obligation on an owner to improve or repair his immovable property in a certain respect, for example, a utility company's notification that one must improve the electrical installation or a municipality's notification that the owner must refurbish the front facade. It is important for the buyer to know whether this has been done. After all, fulfilling such an obligation costs money and, moreover, it has to be done within a certain period of time. The provision should prevent any surprises for the buyer. A summons usually does not come unexpectedly, in the sense that it has usually been clear for some time that something is not right. If the buyer and seller have fulfilled their duty to investigate and their duty of disclosure, the buyer will already know about the defects. In connection with this, the costs will in principle be borne by the buyer if the government or utility company imposes an obligation to repair or improve after the signing of the purchase agreement, but before the transfer of title. Notices in connection with building without, or in violation of, a permit will in principle be for the seller's account.
Article 6.7.1 deals with monuments. There are national monuments, provincial monuments and municipal monuments. Even under the Environment Act, a distinction is made between different types of monuments. A national monument is designated under the Heritage Act before and also after the introduction of the Environment Act.
A provincial monument will be designated under the Environment Act pursuant to a provincial environment ordinance. Until then, a provincial monument will be designated under a provincial monument ordinance.
The intention is that a municipal monument will be designated under the Environment Act as part of the environmental plan. After the introduction of the Environment Act, every municipality will automatically have a "temporary" environmental plan. This temporary environment plan will eventually be converted into a definitive environment plan. However, municipalities have until the end of 2029 at the latest to convert the temporary environment plan into a final environment plan. Thus, a so-called transitional phase applies until no later than the end of 2029. Municipalities may designate municipal monuments under the environmental plan but also under the municipal heritage ordinance until the end of this transition phase.
Incidentally, Articles 6.7.1 and 6.7.2, which deal with monuments and protected city or villagescapes, respectively, refer to "has been designated or is involved in a procedure for designation. In purely legal terms, the Environment Act no longer refers to designation. Under the Environment Act, monuments and protected city or village views will no longer be designated, but the function 'monument' or the function 'protected city or village view' will be assigned to a location.
Article 6.10. If the property sold is a rental property, and it has been agreed with the lessee to vacate the property prior to the execution of the deed of transfer, then it must be taken into account that a lessee has, in principle, the right to take with him those items that the lessee has installed. The tenant must deliver the property in the original condition in which the tenant received it at the start of the lease. There is an exception for permitted alterations and additions and that which has been destroyed or damaged due to age. It is important for buyer and seller to inform each other well about what belongs to the sold property.
Article 6.11 covers all surface areas, such as the cadastral area of the plot and the floor area of the property. Because the buyer has viewed the situation on the ground and therefore the buyer sees what the buyer is buying, it often does not matter much if the stated size differs from the actual size. Therefore, it is common to agree that there will be no settlement if there is a difference between the stated and actual size. Sometimes it can still be important to the buyer that the actual area is correct or nearly correct with the stated area. In deviation from the main rule, the parties can then agree something else. This can be done on the dotted line in Article 6.11. For example, the parties can stipulate that the buyer is entitled to compensation from the seller if the surface area turns out to be at least 5% less than stated. Also lay down the amount of the compensation, for example, an amount for each m2 that exceeds the area specified. Since the purchase agreement does not mention the usable area of the house, it is wise to include this on the dotted line as well. The selling broker can help with this. Realtors (belonging to NVM, VBO or Vastgoedpro) are obliged to measure the property according to the 'measuring instruction utilization area houses', so that the data are known. The size of the plot is also mentioned in Article 1 of the purchase agreement.
Article 6.13 emphasizes that the seller's statement that the seller is unaware of, for example, soil contamination, says nothing about who bears the risk for soil contamination. Buyer may not infer from the declaration of ignorance that there is no soil contamination. So the buyer does not get a guarantee. However, there is also no exclusion of liability. The seller therefore does not place the risk on the buyer with a declaration of ignorance, see the notes to Articles 6.3. and 6.4.1. Risk allocation is a matter of agreement. A declaration of ignorance is about actual knowledge and not an agreement. You simply cannot negotiate about whether or not you know something.
The actual delivery takes place by handing over the keys and taking possession of the sold property. This article indicates that the actual delivery takes place at the time of signing the deed of transfer at the notary, unless another time has been agreed between the seller and the buyer. It also indicates how the delivery takes place, namely free of rental, lease or hire-purchase agreements with the exception of any agreements to be completed. This is therefore not only a question of whether the immovable property is wholly or partially veris rented, but also whether the seller has certain components such as the central heating boiler or the kitchen rentedrented or leased. If the immovable property is delivered free of rent, etc., Articles 6.10 and 7.3 do not apply.
If the seller and buyer agree on a different time of actual delivery, additional agreements are generally desirable, for example regarding the time at which the risk passes (Article 10). In such cases, consult in advance with your insurer and mortgage lender.
Article 7.4 states that all claims that the seller can assert pass to the buyer. This concerns, for example, a guarantee that the seller has on a renovation, on double glazing or on the roofing. The enumeration given in Article 7.4 is not exhaustive. If the SWK, Woningborg, Bouwgarant or GIW guarantee and warranty scheme applies to the property to be purchased, the guarantee is automatically transferred. Information about the terms and the procedure to be followed can be found in the relevant guarantee scheme.
Article 8 specifies the date on which benefits, charges, taxes, levies and canons due pass to the buyer. These include items such as rent, real estate taxes and water board property charges. It is usually agreed that these are transferred with effect from the date of transfer of title: see Article 4. Taxes and/or levies charged for the use of the immovable property are not settled between the seller and the buyer. If the seller moves to another municipality, the seller is generally entitled to relief from taxes and/or levies charged on the use of the immovable property for the remaining full months of the year. If the seller moves to another property in the same municipality, then the assessment usually remains in place. For more information on taxes and/or charges against the use of the immovable property, consult your municipality.
For practical purposes, the effect of this article is that, when there are several persons on either the selling or buying side (for example, spouses or heirs), it is sufficient to address one of them; one is then deemed to have also addressed the other(s). A letter addressed to one of three buyers, therefore, is deemed sufficient to notify all three. The multi-person party thus acts toward the other party as if there were only one person.
According to Article 6 of the sales contract, the immovable property must be delivered in the condition it is in when the sales contract is concluded. Between this time and the time of the transfer of title, anything can happen that changes the condition. From the moment of the notarial transfer of title, the immovable property is at the buyer's risk. Because the signing of the deed of transfer is decisive, the seller would be wise not to cancel his building insurance before then. The risk does not automatically pass to the buyer if delivery is delayed by the buyer's actions or omissions. If the actual delivery takes place earlier than the legal delivery, the risk rests with the buyer from the actual delivery and the buyer would be wise to take out buildings insurance from that time. However, it is possible that the buyer dissolves the purchase agreement after the transfer has taken place. If Article 7:10 paragraph 3 BW would apply in that case, the risks associated with the immovable property would have remained with the seller due to the dissolution of the purchase agreement. This can have major consequences for the seller, because after the transfer, the seller will no longer be insured for the sold property. By excluding the application of Article 7:10 paragraph 3 BW for those risks which are covered by a customary building insurance, it is prevented that after dissolution of the purchase agreement on good grounds by the buyer, certain risks for the immovable property will revert to the seller and those risks will remain with the buyer who will be insured for them.
Article 10 regulates what should happen in case of force majeure (for example, lightning strike or arson by third parties) that neither buyer nor seller can do anything about. If the immovable property is completely or partially destroyed by fire before the transfer of ownership, for example, both parties are no longer bound by the purchase agreement. If the buyer still wants to take the immovable property, the seller must transfer to the buyer the rights from, for example, building insurance.
The seller can also arrange for ownership of the immovable property to be transferred in accordance with the purchase agreement. The seller must then inform the buyer in a timely manner that the seller will restore the immovable property at his own expense before the agreed date of transfer of title (or within four weeks of the disaster, if later).
If the situation referred to in this article arises, it is wise for the parties to consult with each other first. The parties may ultimately, should they not reach an acceptable solution, choose to maintain the dissolution of the purchase agreement. It is wise to put such an agreement in writing.
If one of the parties fails to fulfill its obligations (set forth in the purchase agreement or by law), that party is in default (breach of contract). The premise of this article is that breach of contract must always be clearly established before the other party can take any action based on breach of contract.
This finding is made by giving the other party notice of default, that is, notifying it in an official document that it is not fulfilling its obligations. This must be accompanied by a summons to still fulfill the obligation within eight days. This gives the other party a last chance, as it were.
Article 11 now says that the purchase contract may be rescinded by written notice to the defaulting party if nothing has happened after the expiration of this last opportunity, eight days after the notice of default. The second paragraph of Article 11 states that the "wrong" party must pay a penalty in the amount of ten percent of the purchase price if the purchase contract is rescinded. Should the actual damages exceed the penalty, additional damages may be claimed. Paying the damages alone does not always get the wrong party off the hook. The so-called costs of recovery, which are, for example, collection costs, may also be claimed.
In doing so, however, neither buyer nor seller achieved what they originally wanted. The "good" party therefore has the option after the expiration of the 8-day period to demand performance of the purchase agreement instead of rescission. Of course, the party demanding fulfillment will want compensation for the damages suffered.
To enforce his claim, such party may claim a penalty per day from the ninth day after the notice of default until the purchase agreement is fulfilled. The amount of the fine is set at three per mille of the purchase price of the immovable property, with a maximum of ten percent of the purchase price, without prejudice to the right to additional damages if the actual damages exceed the immediately payable fine, and without prejudice to compensation for costs of recourse. If the party seeking fulfillment nevertheless decides to still rescind the purchase contract, the defaulting party shall be liable to pay a penalty of ten percent of the purchase price, less the daily penalty already paid (pursuant to 11.3), but without prejudice to the right to additional damages if the actual damages are higher, and without prejudice to reimbursement of costs of recovery. Even if a negligent party, who has been given notice of default, nevertheless proceeds to fulfill its obligations, the other party is entitled to compensation if it has suffered damage.
If the penalty payable leads to an excessive and unacceptable result under the circumstances then the court may mitigate the penalty. In doing so, the court will have to consider not only the relationship between the actual damage and the amount of the penalty, but also the nature of the contract, the content and scope of the clause and the circumstances under which it was invoked.
Article 11.6 provides that the penalty regime as contained in Articles 11.2 and 11.3 is "extinguished" as soon as the purchase price has been paid and the purchaser has become the owner of the immovable property (because the notarial deed of delivery has been registered in the public registers). Should a party have previously forfeited penalties under Article 11.3, these penalties remain forfeited. Should it later turn out that there has been a shortcoming (for example, because the immovable property does not appear to have the actual properties as described in Article 6.3), then no penalty may be claimed, but damages may be claimed under the provisions of the Civil Code.
Choice of domicile means choosing legal residence for the enforcement of a legal act. A letter received at the address of choice of domicile is deemed to have been received by each of the parties. Choice of domicile, is primarily intended as a backstop. For example, if one of the parties is difficult to reach, the other can still always reach the other party. It can also be important to prove that a particular letter was sent. In that context, it is often convenient to send the letter both to the actual residential address and to the address of the choice of domicile.
Once the purchase agreement is signed by both parties, there is the possibility of having it registered in the public registers. Whether or not the parties want this is indicated in Article 13. After receiving the purchase agreement, the notary will take care of the registration.
Having the purchase agreement registered in the public registers has the effect of protecting the buyer against subsequent bankruptcies, transfers, attachments, and later established preferential rights. The registration thus has a dual basis: registration under the Civil Code (as protection against later bankruptcies, transfers and attachments) and registration under the Municipalities Preferential Rights Act/Onvironmental Law (as protection against a pre-emptive right established later).
If the execution of the deed of transfer (see Article 4) is scheduled more than six months after the purchase, it is wise to seek further advice on the best time for registration. This is because the registration has a validity period of six months. Incidentally, even if the notary is not immediately instructed to have the purchase agreement registered, the buyer retains the right to have this done at his own expense. This also applies to having it registered at an earlier time than stated in the purchase agreement.
In case the purchase agreement does not go through, for example because the buyer invokes the financing reservation, the notary is already given power of attorney to cancel the registration of the purchase agreement.
Both buyer and seller have an interest in seeing the purchase agreement come to a successful conclusion. Therefore, it may also be important to know which party one is dealing with. Therefore, both buyer and seller can require each other to identify themselves. Before drawing up the deed of transfer, the notary will also ask you for proof of identification. Valid 'ID proof' includes the following: a valid passport, a valid Dutch identity card, a valid Dutch driving license and a valid Dutch alien's document (residence permit).
Article 15.1 may include one or more dates for resolutive conditions. A resolutive condition offers one or more parties the possibility of dissolving the purchase agreement in certain cases. For example, if the buyer is unable to obtain financing (a), does not receive a National Mortgage Guarantee (b) or if the building inspection is negative (c). It is sensible to set the deadlines realistically, depending on the period needed to complete the financing, obtain the National Mortgage Guarantee or have an architectural inspection carried out. Besides the resolutive conditions for the financing, the National Mortgage Guarantee and the technical building inspection mentioned in article 15 paragraph 1, the parties can agree on other resolutive conditions. It is important that all agreed resolutive conditions are properly recorded in the sales contract.
Because of the Mortgage Directive, a lender may not make a preliminary offer, that is, an offer with reservations. Under the directive, the lender makes a binding offer, also called a binding quotation. This is an offer with no reservations. As a result, the lender must have all the necessary information from the buyer, such as income details, an employer's statement and a valuation report, prior to making the binding offer. In connection with the term of the resolutive condition for financing, it is therefore important for the buyer to provide all the necessary documents as soon as possible.
The gross annual burden means the total amount paid annually in mortgage interest, repayment and (risk) premiums together, as well as any additional repayments in connection with the National Mortgage Guarantee issued.
Buyer can also waive one or more resolutive conditions, for example, because seller does not agree to a resolutive condition. However, there are risks associated with this. For example, if the parties do not agree on a resolutive condition for financing and strike out Article 15.1 under a, the consequence is that if the buyer does need a money loan and does not obtain one, that is not a reason to dissolve the purchase agreement. The success or failure of the financing of the real estate is then entirely at the buyer's expense and risk. A similar consequence results from waiving the reservation of a building inspection. If the parties choose not to make use of the resolutive condition for a building inspection by crossing out Article 15.1(c), this has the consequence that the purchaser does not have the option of dissolving the purchase agreement if the costs of immediately necessary repairs to defects and overdue maintenance are higher than the costs the purchaser had reckoned with. Seller may otherwise still be liable for hidden defects under the purchase agreement or the law.
The third paragraph contains a best-efforts obligation of the parties to do everything reasonably possible to obtain the financing and/or National Mortgage Guarantee, commitments or other items.
However, the dissolution of the purchase agreement does not occur automatically, but must be made known to the other party by the one who dissolves. Parties should agree, within how much workdays after the date on which the resolutive condition expires the notice of dissolution must be received by the other party or his broker. Saturdays, Sundays and generally recognized holidays shall not count in the calculation. At the end of the period mentioned in 15.1, it will be established whether the resolutive condition can be invoked. can be invoked can be invoked. At the end of the period mentioned in 15.3 it is established whether the resolutive condition has actually been invoked. has been invoked.
Recourse to rescission must be "in writing and properly documented by common means of communication." Written means that a phone call is not sufficient. What "properly documented" means depends on the content of the resolutive condition. By default, the purchase agreement states that the buyer must provide one rejection to invoke the financing reservation. In many cases, this will be sufficient. Lenders today are so bound by rules under the Financial Supervision Act that it can be assumed that a rejection from a lender is based on a thorough assessment of the buyer's financial situation, even if the rejection is worded summarily. As a result of codes of conduct and legislation, underwriting conditions of lenders differ little, if at all. Submitting an application to a second lender is therefore also likely to result in a rejection. In addition, the ban on commissions has been in force since January 1, 2013. For a buyer, this means that the buyer must pay advisory fees to the mortgage advisor or lender. If after one rejection it is clear that the financing will not be completed, it is inconvenient for the buyer to have to pay a second rejection fee. In addition, the time factor can cause problems if the process has to be gone through again after the first rejection. The period of the resolutive conditions may be too short. Therefore, in many cases the submission of one rejection will be sufficient to justify dissolution. The parties are free to agree that several refusals must be submitted or that, in addition to a refusal, (an)other relevant document(s), which the buyer has or should reasonably be able to obtain, must be submitted. If the parties wish to make use of this, the required documents can be filled in on the dotted line in Article 15.3. This could include, for example, a copy of the mortgage application, copies of pay stubs, etc. If the purchaser wishes to invoke dissolution as a result of the building inspection referred to in Article 15.1(c), 'well documented' means that a copy of the inspection report, which includes a summary of the costs for the immediately necessary repair of defects and overdue maintenance, must be submitted to the seller or his estate agent.
Through common means of communication means, for example, a communication by registered mail
is made. The advantage of this is that it can be proven that the communication actually took place. However, if communication was made between seller and buyer (with or without the intervention of a broker) via email, that may also be a "common means of communication" between parties involved.
When a consumer buys a home, the buyer has three days to consider whether the buyer wants to go through with the purchase. In almost all cases, this cooling-off period stems from the law. The statutory cooling-off period may not be shortened. However, the parties may agree to give the buyer a longer cooling-off period.
The law has no cooling-off period for seller. The parties can agree that the seller will also have a cooling-off period.
The cooling-off period begins on the day following the date on which the buyer received (a copy of) the purchase agreement signed by both parties. Usually (the seller's) broker will hand a copy of the purchase agreement to the buyer immediately after both parties have signed. The (broker of the) seller will then request a receipt from the buyer. The receipt must bear a date so that it is clear when the buyer received the copy of the purchase agreement. For the start of the cooling-off period, it is not necessarily necessary for the buyer to personally hand over the (copy) sales contract. Although handover is preferable, the purchase agreement can also be sent, for example by registered mail. If the sales contract is sent rather than handed over, it is recommended that it be sent both to the actual residential address and to the address of choice of residence (see Article 12).
If the buyer renounces the purchase within the cooling-off period, the buyer must ensure that the cancellation notice reaches the seller or his broker before the end of the cooling-off period. There are no legal requirements for the form in which the buyer must inform the seller that the buyer is cancelling the purchase. However, dissolution of the sale in a provable manner, for example by registered letter, is always advisable. For optimal use of the cooling-off period, the choice of domicile (see Article 12) is very important. If the purchaser wants to cancel the purchase agreement at the last minute, but the seller or his estate agent cannot be reached, the purchaser can inform the notary of the cancellation. As a result of the choice of domicile, the notification that the purchase agreement has been dissolved is deemed to have reached the seller. This is particularly important in the context of the burden of proof.
In many cases, it already follows from the law that both parties must sign the purchase agreement. Often parties will do so immediately after each other. However, it can happen that there is some time between the moment one party signs the purchase agreement and the moment the other party does so. This situation occurs, for example, when one party sends the contract to the other. Article 17 paragraph 2 prevents parties from leaving each other in uncertainty for an unnecessarily long time. If the first signatory does not receive back the purchase agreement signed by the other party within the agreed time, the first signatory can waive the purchase agreement for a certain period of time. Of course, the first signatory does not have to do so, but has the choice. There are no requirements as to the form in which the first signatory must rescind the agreement. Of course, it is prudent to do so in a manner that is provable afterwards.
This provision is included to avoid ambiguity regarding parties of different nationalities involved in the purchase agreement. By declaring Dutch law applicable, the Dutch court has authority to settle any disputes arising from the purchase agreement.
Seller may indicate here which attachments belong to the purchase agreement.
Article 20 may contain additional provisions on matters that the parties have also agreed upon but are not included in the pre-printed text of the purchase agreement. It is very important to carefully word and describe these additional provisions. A real estate agent can assist with this.
*) The text included in the boxes is the text included in the purchase agreement. There is no need to fill them in.
Provided by brokerage firm: