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Buyers Guide
Since Poland joined the EU in 2004, the ban on foreigners owning property has been lifted, however if you do not have Polish nationality and are buying a holiday home you have to apply for permission from the Polish Home Office, which must be obtained before you complete; alternatively, as in the rest of Eastern Europe, you could buy via setting up a Polish company. On choosing a property you wish to buy, the price can be negotiated directly with the owners face to face contact is far more common when buying or selling a property in Poland than it is in the UK or through the estate agent. Once you have agreed a purchase price you should make an appointment with a notary for the sale to be recorded as legally binding it is commonplace for both the buyer and vendor to use the same notary and often meetings are with all parties present. You may if you wish and its advisable to do so appoint your own English-speaking solicitor. At the very least you would be wise to engage the services of a translator as all sales documents, naturally, will be written in Polish. The notary will draw up an initial contract which will outline the details and any conditions that must be met before the sale completes (for example, repairs that must be undertaken by the vendor). At this juncture a completion date will be agreed and a deposit of approximately 20% is due to be paid by the buyer. After the initial contract is signed the notary will carry out the necessary checks/searches. Assuming all is in order, at the final contract meeting the balance of the money must be exchanged and the vendor must supply a document drawn from the council offices on that day stating that there are no loans secured on the house loans secured on a property stay with the property, not the owner, and will thus be passed onto the new owner. On a new-build property 7% VAT is levied. It is customary for the buyer to pay the notarys fees (which include all taxes to be paid) of approximately 2-2.5% of the purchase price. Costs Agency fees: 3% each from buyer and seller Legal fees: 0.1% plus VAT Taxes: 5% of sale price Registration fees: 2% Resale tax: 10% if you sell within five years, unless the proceeds are invested in another Polish property Things to Consider: Ensure that you have full ownership of the property upon completion, and that the relevant documents are available for the lender. With newly constructed properties, ensure that you know the date that the property will be registered to you. The lender cannot lend on the security of the property until it has registered. Due to the Polish legal and administrative system, there may be slight delays on securing your loan, despite the fact that all reasonable steps will be taken to avoid this. So be prepared. Make sure you have researched every possible cost that you may incur, whilst purchasing a property in Poland . Note, you may be charged by the government in addition to the lenders legal costs (the Lenders costs however are usually specified when the Lender offers you the mortgage). Unless you are very experienced in purchasing abroad, it is very important that you seek some sort of legal advice before signing the contract for a property or paying a deposit. The Lender will require a copy of these signed documents together with an application form, however you will be able to sign these documents 'subject to mortgage finance', once the contract is signed it is legally binding, so if you do not state this and the Lender does not wish to do business with you, this could be a huge problem. A new Polish bank account will be required (however some lenders may offer this as part of the package). The completion of a Polish mortgage takes place in front of an appointed Polish notary and all parties to the mortgage, including the vendor, lawyers and a representative of the lender need to be present. However a power of attorney may be used to sign on your behalf for the mortgage and land deeds. A copy of this power of attorney will need to be presented to the lender in good time before completion. It is advisable that a life assurance policy is set up on all mortgages. Properties in Poland can be purchased by an individual or in joint names.
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