You've found a property you love...Great...now reserve it! The buying process in Malta consists of two stages, the Promise of Sale which secures the property and the Final Deed where the property is transferred into the name of the purchaser. First step in securing your property is setting an appointment for the signing of a promise of sale. Some developers may also request a binding deposit to reserve a particular unit in a development. Such deposit will be subject to conditions safeguarding the interests of both parties.
Select Your Notary
The promise of sale must be signed in the presence and registered by a notary. The notary, after the signing of the promise of sale, will also be responsible in carrying out searches on the property verifying its correct title. As the purchaser, you are responsible for notarial fees, therefore the choice of which notary to use is yours. There are many respected notarial professionals residing in Gozo & Malta and their services are readily available. For a list of notaries please visit the website below. https://www.notariesofmalta.org/
Draft of Promise of Sale
Once you have decided upon a notary and passed on all the details of your purchase, the notary can begin to draft a promise of sale. When purchasing a unit from a development a draft will be standard to the whole block and this can be passed onto your notary for the inclusion of your personal details. Once the notary has finalised a draft this will be sent to all parties and at this time you are free to discuss any details you have before the appointment for signing.
Specified Power of Attorney (if required)
Should for any reason you may not be able to be physically present for the signing of the Promise of Sale,it is acceptable for an allocated power of attorney to appear in your stead. Once you have chosen your representative, the notary can draft a power of attorney specifically for the signing of the promise of sale and also the final deed should you wish. At any time you can also decide to attend the signing of both agreements yourself if possible even if a power of attorney has been allocated.
Signing of Promise of Sale
Both parties, or their representatives, will appear in front of the notary during the promise of sale. At time of signing a deposit on the property will be placed with the notary. This amount will vary depending on the sale but usually ranges between 10% to 20% of the value of the property. When purchasing a property both parties in most cases are liable for, in layman's terms, either buyers or sellers tax (stamp duty for purchasers / property transfer tax for sellers) At time of promise of sale the purchasers pay 1% of the total tax to be paid with the remaining amount to be paid on signing of deed. Sellers pay all their tax at time of deed All agency commission costs are borne by the sellers and this is also paid at time of deed. The government at various times releases various schemes and tax incentives related to the purchasing of property in Malta. Please ask us for further details or keep yourself updated by clicking on the links below. https://cfr.gov.mt/en/Pages/Home.aspx https://housingauthority.gov.mt/en/Pages/default.aspx
Should you be using a bank loan to finance your property, you may have probably had your initial meetings with your chosen bank with regard to the amount of financing you are qualified for. After the signing of the promise of sale the process of officially applying for a bank loan begins. The bank will require a copy of your signed promise of sale and other documentation provided by you or an architect on your behalf. Six to eight weeks after your application you should receive a sanction letter from the bank approving your loan. This sanction letter should be passed onto your notary.
Customer Due Diligence
It is normal procedure in Malta for due diligence to be carried out on individuals or companies who undertake a financial transaction amounting to more than ten thousand Euro. You will be asked to fill out Know Your Customer forms and provide residential address documentation by ourselves and the notary. In some cases you will also be asked for documentation associated with the funding of your purchase. Rest assured that this is a standard request in all transactions and your cooperation is greatly appreciated. We are here also to answer any questions you may have.
Final Deed & Handover
Once the notary is ready to proceed to final deed and all subjects listed in promise of sale have been completed, then an appointment for the signing of the final deed can be made. Both parties, or their representatives, are present for the signing held either at the notaries office or at the bank should a bank loan be involved. At time of signing the final balance must be paid to sellers along with any tax owed on the sale from both sides and other expenses incurred in relation to the sale. On signing of the deed purchaser will receive keys and full access to their property.