The Preliminary sales agreements: promesse de vente and compromis de vente

A preliminary sales agreement is a contract used to outline the transfer of real property in France from one party to another.  There are two main types of contract typically used, the Promesse de Vente and the Compromis de Vente.

The Promesse de Vente is a promise to sell the property to the buyer for a specific price within a specific timeframe. The timeframe is agreed upon by both parties and can be as long as four months.  Typically a deposit of 10% of the purchase price is paid by the buyer at the time of signing.  The buyer then has seven days in which he may change his mind and withdraw from the contract without penalty.  After the seven day cooling off period, the contract is legally binding and the purchaser must purchase the property within the option period or forfeit its deposit.

More commonly, the Compromis de Vente contract is used. While the Promesse de Vente is a promise to sell the property extended from the seller to the buyer, the Compromis de Vente is more of a compromise between parties and is often understood as being a sale and purchase agreement.  In a Compromis de Vente the buyer makes a commitment to purchase the property.  Like the Promesse de Vente, the Compromis de Vente often calls for a 10% deposit and allows for a seven day cooling off period.

Both the Compromis de Vente and the Promesse de Vente may contain additional agreed conditions and stipulations that govern the transaction.  The conditions, if not met, may invalidate the agreement and release the parties from their obligations.  Such conditions might include the buyer’s ability to obtain bank financing, adverse zoning easements, and local government exercising its pre-emptive right.

No matter which contract you use, it is not to be entered into lightly.  Consult your notaire and go over all the terms and conditions in detail before finalizing the agreement.

by Cheryl Hartzman, AboutFrenchProperty.com - Copyright © About French Property