Is a private purchase option document convenient for us?
I am interested in buying a premises and the selling party can not transfer possession yet within a year. I’m proposed to grant a private document of purchase option. Could this be a problem?
The private purchase option contract is perfectly legal and binds both parties. We believe that to be totally calm the registration of the contract in the Land Registry would be necessary. And this, for what? To avoid many legal risks that we detail below:
- If the seller was a person or an unscrupulous company, or rather a scammer, could do the same operation with several people at once. This had happened many times in the past and fortunately, today is very rare but we can not say that the problem is one hundred percent eradicated.
- It could happen that at the moment in which the purchase option was signed, it was verified that the building is free of charges, but what can not be guaranteed is that it is at the moment of exercising the right of option and consummating the sale.
- It could also happen that the selling party, being a company, declared bankruptcy or bankruptcy, and consequently all rights would be lost.
Quite the contrary, if the inscription in the Property Registry of the purchase option is made, any subsequent charge does not imply loss of their rights and in the event of bankruptcy, the judicially appointed Trustees can grant the definitive deed, after the consignment of the amounts corresponding to the price of the option.