Property purchase - Lawyer review / Contract penalties / Reservation?

Hello hello!

On Friday, my husband and I have an appointment with a property developer because our favorite plot is now available for us *happy*

On the phone, the nice gentleman told us that it is an introductory meeting where everything would be calculated. We would then have the long weekend to decide.

Now I feel a bit pressured because I know there are also several other interested parties if we don’t want it. A friend advised us to have the contract reviewed by a lawyer right away and to insist on penalties for construction delays. Has anyone had experience with this? So far, we have never dealt with a lawyer...

What happens if we sign the contract on Tuesday and afterwards (for whatever reason) the financing does not come through? Is the contract then simply void?

Somehow everything is happening so fast now and I don’t know if the short "consideration period" is normal.

I’m looking forward to answers :) Best regards Kati

Never let yourself be pressured! Better to quit and look for another object..

I may have expressed myself incorrectly, we were not pressured by him. I put pressure on myself because suddenly everything is moving so fast and I am afraid that the property will be gone if I think about it for too long.

The developer never said that there were many interested parties, but at the moment it is the last property in that price range in the district. The neighboring property was also gone immediately and the listing had not been posted for long, so I strongly assume that.

Without a financing confirmation you should not sign, unless you are absolutely sure that you will get financing (civil servant, public service, good equity, as an example mentioned).

Usually, you then have to pay a kind of contractual penalty yourself to get out of the contract.

Apart from the fact that your friend has quite "bold" suggestions and wants to shoot with the cannon right away.... but that an expert should review the contract, he is right about that.

And of course it is the last plot of land that _everyone_ wants - if that is not exerting pressure, provided it is a means of the sellers , then I don’t know either ;)

Regards, Yvonne

Relax. You cannot sign the contract because that can only be done with a notary, and they must send you their draft 14 days before the signing. With the seller, you can at most sign a reservation and then take care of financing and co during its term. Otherwise, always sign the loan agreement first and then go to the notary within 14 days, never the other way around.

A friend advised us to have the contract checked directly by a lawyer and to insist on penalty clauses for construction delays.

The advice is generally good and correct.
A lawyer's hour costs 200-300 EUR net.

The market situation, in which building plots are snapped up like hotcakes, hardly leaves any room for contract negotiations with developers and/or construction companies....
Penalty clauses sound nice. But why should the developer agree to that? Won't he rather offer it to the next interested party? And is it really a developer? Or a general contractor?
A certain legal protection for developers is provided by the Real Estate Agent and Developer Ordinance, especially the payment schedule in § 3 II of the Real Estate Agent and Developer Ordinance, which is not easy to understand.

ALL construction contracts contain more or less ineffective clauses; the lawyer will therefore find something. The question is whether the developer still wants to change anything. Otherwise, he could have simply agreed to the statutory provisions. These are balanced and effective.

What happens if we sign the contract on Tuesday and afterwards (for whatever reason) the financing does not come through? Is the contract then simply void?

Principle: contract is contract. You have to have money when you enter into contracts.
Therefore: agree on a contractual right of withdrawal in case the financing fails...