The real estate market in Ukraine is undergoing a rather steep rise. Buying a property is one of the most stable ways to invest your savings in Ukraine. At the same time, without properly checking there is a chance to buy “a pig in a poke”. Careful check-up will help you to minimize risks associated with the deal and avoid fraud.
First of all, after selecting the desired apartment or other property for purchase, it is necessary to request a number of documents from the seller, namely:
· Title deed on the property. It can be a sale and purchase agreement, gift agreement, contract of exchange, certificate of heirship, certificate of title, etc. Also, it requires special attention when the owner received the real estate property as a legacy. In this case, there is a need to prove that there are no legitimate claimants to the inheritance, except for the seller.
· Passport and Ukrainian taxpayer number. These documents prove the legal capacity of the seller and are requested by notary for the deal. It is necessary to make sure that the person has reached the full legal age (above 18 years old). Btw, the buyer, even if he is a foreigner, also should provide both documents to be able to buy the property in Ukraine.
· Documents confirming marital status of the seller. According to Ukrainian legislation, in cases, if the seller is married the notarized consent of his/her spouse for the sale of real estate is required. Otherwise, the agreement may be deemed invalid by the court in the future.
· Document confirming that no one is registered in this real estate. Ukrainian legislation does not forbid selling the property, where some people are registered, and such registration may be canceled in the future by the new owner, however, there is special protection for children, which has to be taken into account. Thus we recommend canceling all registrations before the deal.
· Receipts for utilities. Receipts will allow you to make sure that the owner of the real estate has no arrears in the payment of utility services.
· Technical audit. It is also recommended to invite technicians to check all the utilities, walls, floors, etc. If the building is old, some unexpected problems may appear.
The next necessary step shall be the verification of the real estate in open registries:
· State Register of Proprietary Rights to Immovable Property.
In this register, you can see the real current owner(s) of the property, the history of registration of proprietary rights to the premise, as well as the presence or absence of encumbrances on the real estate such as a mortgage or rent for the term over 3 years.
· Passport Validity Checking Service. This service allows you to check the validity of the document confirming the identity of the seller.
· Register of Debtors. The Register of Debtors allows you to verify information about the seller’s default.
· State Register of Court Decisions. This registry may help you to check if there are any legal disputes concerning the particular object of the real estate property. Nonetheless, it should be noted that even if the dispute is settled there is a risk of its resumption.
· Public Cadastral Map of Ukraine. The cadastral map allows determining the status of the land plot on which the real estate property is located.
Also, it will not be superfluous to search for public information about your counterpart and the object itself on the Internet.
The sale and purchase agreements of real estate in Ukraine must be made in writing and notarized. The notary is obliged to check the documents and make an extract from the State Register of Proprietary Rights to Immovable Property in order to make sure that the seller has the legal capacity to sell the property. However, the notary makes this check-up only to the extent required by law which will not cover all of the mentioned aspects.
Particular attention should be paid to cases where the sale and purchase agreement is signed by a person on the basis of a power of attorney. It may happen that at the time of the conclusion of this transaction the seller has already withdrawn the power of attorney, especially, if PoA has been issued abroad. This entails the risk of cancellation of the transaction. Therefore, it is recommended to invite the owner for personal signing of the transaction documents.
In order to avoid fraud and conclude the deal safely, you should make sure that all necessary checks have been completed to satisfaction. Performing a thorough and detailed due diligence on the chosen real estate property object is the most crucial part of the deal. For these reasons, in order to make the right decision and take into account all the potential risks, it is better to have a full due diligence report prepared in advance by a property lawyer.
If you consider buying a property in Ukraine – contact us and our lawyers will help to protect your deal.