The purchase and sale of a property are generally made official by a provisional sales agreement. As real estate specialists, MGM’s experts can assist you with drafting your provisional sales agreement and reveal all the practicalities of this preliminary contract: documents to provide when drawing up the provisional sales agreement, conditions of withdrawal, signing before a notary… Follow the guide!
What is a provisional sales agreement?
The provisional sales agreement is a contract that sets the conditions of sale ahead of reiteration of the deed before a notary. As a preliminary contract, it is equivalent to a notarial deed or a private deed. The provisional sales agreement therefore precedes the purchase/sale of a property, and specifies all the terms of sale:
- The price of the property;
- The type of purchase: mortgaged or not, property in a classic condominium or tourist residence;
- The cut-off date;
- The special conditions of sale;
- The identity of both parties (buyer and seller);
Additional information about the property for sale: address, description, vendor’s title to property, and any easements and mortgages.
Why enter into a provisional sales agreement?
When you want to buy a property, establishing a provisional sales agreement allows you to secure your future transaction and bind yourself with the seller. The agreement serves as a promise made by the seller to the buyer, and a promise made to the seller by the buyer. The signature is also the concrete way to fix the price of the property and all the conditions of sale (general, special and precedent).
The provisional sales agreement also gives you a right of withdrawal for a period of 10 days after signing. If you decide that you no longer want to buy the property during this period, the seller returns the security deposit (representing 10% of the sale price) that you gave them at the time of signing.
How do I enter into a provisional sales agreement?
Provisional sales agreement: what documents do I need to provide?
When establishing the provisional sales agreement, the seller must provide several mandatory documents, whether the transaction is taking place before a notary or not. These documents are collected together in the Technical Diagnostic File (DDT)1.
If the property you want to buy is being sold as part of a classic condominium, the seller must provide additional documents along with the provisional sales agreement:
- The documents relating to the organisation of the building ;
- The documents relating to the state of the building;
- The documents relating to the financial situation of the condominium and the lot being sold.
How do I withdraw?
After signing the provisional sales agreement, you have a period of 10 days during which you can withdraw. If you exercise this right, the sums paid as security are returned to you, and you have no further obligation to the seller.
The seller, on the other hand, does not have a right of withdrawal. If all conditions precedent are fulfilled (mortgage obtained, absence of easements, right of pre-emption), both parties must sign the final deed of sale.
Do I have to use a notary?
Although the provisional sales agreement can be signed between individuals, we strongly recommend calling on the expertise of a notary (or bailiff). The latter will take care of:
- Drafting the preliminary contract,
- Checking the documents to be appended to the provisional sales agreement,
- Drawing up the deeds based on your discussions.
The notary also guarantees the legal validity of the sale, and can advise you on the most advantageous agreement terms for your situation.
Having specialised in construction and real estate development for over 50 years, MGM’s experts can assist you at every stage of your investment project. Our experts can provide you with personal advice tailored to your situation and goals.
You can also benefit from our know-how to make your tourist residence investment a success, find out the various types of mortgage available or be informed about drafting a commercial lease. MGM offers you new-build property developments in the Alps’ most beautiful resorts. Discover the advantages of our upmarket residences online..
1 DDT: The Technical Diagnostic File must contain the various health and safety and legal reports and statements: asbestos survey or asbestos report (for buildings with a building permit issued before 1 July 1997); lead exposure risk statement (for buildings constructed before 1 January 1949); termite and dry rot surveys (for buildings constructed in at-risk zones defined by the prefect); gas installation report; prior electricity installation report; and natural, mining and technological risks report.