Last update12:12:22 PM

Back You are here: Home Legal and Finance Legal Did You Read Your Contract?

Did You Read Your Contract?

We have heard many a time from foreign buyers about problems with off plan property purchases in Bulgaria. In particular relating to their discovery that they didn't get that free kitchen or use of the development's jacuzzi, which they thought was part of the deal. Frequently this turns out to be down to what was, or was not, included in the detail of the preliminary contract and deeds.

Buyers often feel cheated by the agents and the glossy brochures but this is marketing "puff" and it is only what is in the contract which counts.

Most agents' and developers' web sites and brochures will have disclaimers, although difficult to find and often over-looked on the part of the buyer. Pretty pictures and flowing words are lovely but do not count, so don't rely on these for proper information. Of course, wonderful colourful images play their part, otherwise most buyers wouldn't look twice, but the disclaimers are there to let you know that these are ads and not to be relied upon.

The key to making sure you get everything you believe you should when buying your off plan Bulgarian property is the contract. (Indeed the same holds true, whatever property you are buying in Bulgaria).

Even with a good lawyer, buyers can still misinterpret things. You need to work with your lawyer to make sure you and he understand what should be written in that contract to protect your interests.

Your lawyer is unlikely to know what has been "promised" as part of your purchase. He is not going to check whether the details sent by the developer match what was said on their website. Therefore, the onus falls on you to ensure your lawyer knows what you expect to be included. Go into the detail of everything, even such things as whether the water, electricity and heating system will be connected in your property. Sometimes, confusion can be down to language problems. Frequently the Bulgarians describe a kitchen area as a kitchen box. Usually in Bulgaria, this is not, as one may think, a fitted kitchen but it just an area where you can instal your kitchen. Check and check again.

One common complaint is the use of communal facilities, such as those of the jacuzzi, spa and payment for extras including towels, sunbeds. These are often advertised as being free for owners but frequently, when owners arrive at their property, they find they have to pay for them. Again, it is the contract which will determine whether these are included in your purchase or not - not the adverts.

Another common problem is when a buyer needs to take a mortgage to purchase the property. The agent breezily says it will be no problem and the buyer believes this and leaves it at that. However, the buyer should nevertheless once again protect their interests in writing and should insert into the contract that the purchase is dependent upon obtaining a mortgage (usually to include how much, maximum rate of interest, which lenders the application will be sent to and a time frame to apply and receive such a mortgage). You will certainly lose your deposit, which could run into tens of thousands, if you cannot obtain a mortgage and this was not a clause in the contract. In this way, the buyer is not relying upon the words of the estate agent that a mortgage will be easily come by.

Before you even so much as hand over a deposit, ensure you see the contract first. This can be difficult with some developers as they do not wish to have a stack of different contracts with numerous buyers, but it is worth insisting on this. If you see the contract first, then you will discover whether the promises made in the marketing material are actually supported by the contract.

We have heard from many buyers who are up in arms about Bulgarian agents and developers, saying that they have been deceived and that Bulgaria is a lawless state. Whilst, it may be true that some buyers have been deceived by unscrupulous agents or developers, there is no foundation that Bulgarian law is to blame.

In most cases, the contract was simply not detailed enough to protect the buyer. The contract has the purpose of ensuring that the developer will not cut corners and will deliver what has been promised.

Rather than putting the emphasis on the contract, a foreign buyer can be so caught up in the idea of their new Bulgarian home that they forget all about the legal details. Often paying 30% deposit without even considering any more than sunny holidays or snowy ski pistes. At this point, the damage has already been done and a contract possibly signed without the buyer even knowing what it says.

If then, the buyer runs into difficulties later because 'xyz' was not delivered by the developer, it is impossible to take recourse under Bulgarian law, if 'xyz' was never stated in the contract that it had to be legally supplied.

Don't fall into this trap. Together with having your own independent lawyer, the detail of the contract must be laid out in full, together with clauses in the contract that demonstrate what will happen if the developer does not deliver on the promises made. These two things alone will enable the buyer to discover whether the developer is sure or not whether he will really deliver what he is saying.

Don't just read emails which gloss over things and talk on the phone with your agent or lawyer. Read the contract for yourself. As the buyer you need to get involved and take responsibility in the drawing up of the contract and its terms, without this you could be left high and dry.

If there are any disputes, it is the contract written in Bulgarian which is legally binding. Get everything translated by a registered translator into your native language, so that you fully understand the contract.

Remember, If a detail is not specified in the contract then it does not exist and you have no recourse.