Real Estate Purchase Contractpiva

When you decide to buy a property, it's easy to get carried away with the photos and the visit, but understanding the sales contract is fundamental to guaranteeing your rights. After all, this contract is the document that formalizes the transaction and defines the obligations of both parties.

What is a real estate purchase contract?

In practice, the real estate purchase contract is an agreement between the buyer and seller, which establishes that the seller will deliver the property in exchange for the payment agreed by the buyer. It sounds simple, but there are important details that deserve attention.

What to look out for before signing the contract

Details of the parties: The contract must contain full details of both parties - buyer and seller. It sounds basic, but it's essential to check that everything is correct.
Description of the property: The contract must describe the property in detail, including the size, location, registration number and more. This avoids surprises after signing.
Price and payment method: The payment terms must be clear. The contract should state the total amount, the number of installments (if any), and the form of payment (financing, cash payment, etc.).
Deadlines: The contract should specify the deadline for delivery of the property, especially if it is under construction. If there is a delay, the buyer can demand compensation or even rescission of the contract.
Guarantees and penalties: A guarantee clause is necessary to protect the buyer in the event of construction defects or unreported problems. It is also important that the contract provides for fines for both parties if one of them fails to fulfill an obligation.
Termination of Contract: Termination occurs when one of the parties decides to end the contract before all obligations have been fulfilled. Various reasons can lead to this, such as default or hidden defects. It is crucial to check the clauses that regulate this situation, especially regarding the return of amounts paid.
Updating of amounts and interest : Contracts often include clauses on updating amounts and interest, usually based on official indices such as the IGPM (General Average Price Index) or INPC (National Consumer Price Index). Interest rates should be transparent and respect the legal limit of 1% per month.

Other important issues

In addition to the aspects already mentioned, it is essential to observe:

Abusive clauses: The contract must be fair and balanced. Clauses that put the consumer at an excessive disadvantage, or the seller at an exaggerated advantage, can be considered null and void.
Documentation: Checking the documentation of the property and the seller is crucial to avoid surprises. Ideally, the property should be free of encumbrances and pending issues.
Delivery date: It is important that the contract stipulates a clear deadline for delivery of the property. Delays may give rise to a right to compensation on the part of the buyer.
Legal advice: Whenever possible, consult a lawyer specializing in real estate law before signing a contract. This can prevent future problems and ensure that your rights are respected.

Summary table

The summary table, provided for in Article 35-A of Law 4.591/64, summarizes the most important information in the contract. It came about to combat the high number of lawsuits related to ignorance of contractual clauses, encouraging essential information to be on the first pages. In short, it must contain:

Total price of the property
Down payment and brokerage
Payment method and deadlines
Consequences of termination and monetary restatement
Deadline for delivery and obtaining the building permit

I. The total price to be paid for the property;

II. The amount of the down payment and its payment terms;

III. The brokerage amount and its conditions;

IV. The payment method, with installment amounts and due dates;

V. The applicable monetary correction indices;

VI. The consequences of terminating the contract;

VII. The applicable interest rates;

VIII. Information on the right of withdrawal;

IX. Deadline for payment of obligations after completion of the work;

X. Information on encumbrances on the property;

XI. Incorporation registration number and identification of the registry office;

XII. Deadline for obtaining the building completion certificate (habite-se).

If any mandatory information is missing, the buyer can request contract termination.

What can happen if information is missing or the summary table is not included in the contract?

The absence of this information allows the buyer to request contractual rescission, as was the case in a recent decision by the São Paulo Court of Justice (TJSP), which ordered the rescission of a contract for the purchase and sale of a property on the ground floor due to the lack of mandatory information in the summary table.

Buyer's rights

Under the Real Estate Settlement Law, the buyer can withdraw from the contract and request a partial refund of the amounts paid. If the property is under construction, the buyer is entitled to a refund of up to 50% of the amounts paid. If the property has already been completed, this refund can be between 75% and 90%. The refund must be made within 180 days, or the seller will be penalized.

What happens if the buyer doesn't pay?

If the buyer doesn't pay what they owe and the contract is canceled, they have the right to get back what they paid the developer, but under certain conditions:

Broker's commission: The amount paid to thebroker will not be returned.
Fine: The developer can withhold up to 25% of the amount paid, as a form of compensation.

These rules are a way of avoiding losses for the company, but at the same time ensuring that the buyer gets part of what they paid back.

Special situations

The article also deals with some specific situations, such as:

Use of the property: If the buyer has been using the property for some time, this may change the amount to be returned.
Patrimony of affectation: When the property is protected by a special regime, the return rules may be different.
Buyer replacement: If the buyer finds someone else to take over the contract, they can exit the agreement with fewer losses.

These rules help avoid disputes and make things clearer for everyone involved.

Right of withdrawal

In addition, the buyer has the right to withdraw from the purchase within 7 days, if the contract was signed at a sales stand or outside the developer's headquarters. In this case, they get all their money back, including what was paid to the broker. To withdraw, simply send a registered letter, and the deadline starts from the date of posting.

The importance of registering the contract

The last tip is essential: register the contract with a notary! Only with the contract registered will the property officially be in your name, and you will have the legal certainty you need.

Buying a property is one of the most important decisions in many people's lives. That's why reading carefully, negotiating the clauses and relying on good legal advice are essential steps to avoid problems in the future.

Do you have any doubts? Get in touch with our team to find out more!