A property is being reserved if the buyer decides to buy the property. The property is booked on the basis of a reservation contract, by which the buyer commits to buy the property and which the seller and the real estate broker commits not to offer the property for further sale. When signing the reservation contract, the buyer pays a reservation fee (blocking fee), which usually becomes the first installment of the property purchase price. The amount of the reservation fee will be agreed between the buyer and the seller, but it is usually around 3% of the purchase price. The reservation contract is a future purchase contract and it is binding. The reservation contract is signed between the buyer, seller and the real estate broker as three-way contract. The reservation fee is deposited in a pre-selected deposit account.
Before signing a reservation contract, it is important to:
- Legal verify the property, for possible restrictions or the property.
- Legal verify the seller, for possible insolvency or execution of the seller.
- Real estate inspection is highly recommended.
- Securing a mortgage loan if it is part of financing and thus avoiding possible loss of the reservation fee.
- Make sure that the buyer is familiar with all aspects, such as noise, dustiness, or other potential area restrictions.
Some properties has more buyers and it is a matter of time who will book the property first, but it is reasonable to think carefully about everything, and it is recommended to consult the content of the reservation contract with your lawyer as well. The reservation contract is binding and everything needs to be checked carefully.
- The broker will arrange and pay the legal examination of the property within the commission.
- The broker will ensure and pay the legal examination of the seller within the commission.
- The broker will arrange and pay the reservation contract within the commission.
- The broker will ensure and pay the official verification of signatures within the commission.
- Broker at the request of the buyer or seller arrange inspection of the property. The inspection shall be paid by the client.
- The broker will arrange a deposit for the reservation fee. The deposit safekeeping fee shall be paid by the buyer, seller or both equally.