The Purchasing Process

Stage 1
Visit the area in Bulgaria that you are considering buying in order to satisfy any concerns you may have, to help with your decision. Viewing trips can be arranged through us. Our offices in Sofia and Sunny Beach have experienced English speaking Bulgarian associates who can accompany you.

Decide on your budget and the area you would like to purchase and choose the property that best suits your requirements. Confirm the total property price, schedules of payments and build a construction timetable so you are happy and aware of when your payments will be due.

You will then be required to sign a reservation form and return it with your deposit payment (generally 1000 Euros) in order to hold the property and take it off the market. Your deposit is non refundable but will be deducted from the purchase price of your property on receipt of your first installment.

Stage 2
Your Preliminary Contract of sale will be issued within 21 days of receipt of your reservation deposit. If the property has land you will need to register a company.

Use a Lawyer to do the standard checks on:
• Title documents
• Licenses and permissions
• Debts on title
• Terms of contract

Once you are satisfied please sign both copies and return to Smartbuy Afrodite International Investments with your first installment by bank transfer or cheque within two weeks.

Stage 3
We will advise you in good time of installments as required in accordance with your schedule of payments as outlined in the Preliminary Contract. You will be advised when your final payment is due.

Stage 4
At the final completion stage, the remaining balance must be paid in order that the property can be signed into your name. In order for this to happen the Notary Act needs to be signed. Your legally appointed representative can sign on your behalf if you are unable to be present in Bulgaria to do this yourself. You will receive the title deeds within one week to ten days of the Notary Act from the local council or Municipality as it's known in Bulgaria.

Notary Act Information

The Bulgarian property system uses Notaries and a Notary Act in order to transfer the ownership of buildings and/or land.

Prior to signing the Notary Act, the local municipal council conducts a tax evaluation of each property - "tax estimation price", and this valuation represents the minimum value that must be reflected on the Notary Act. The "tax estimation price" is for the purposes of real estate taxation and is much lower than the actual selling (purchase) price, and in general the tax evaluation rate ranges from 25-50% of the full market value.

Most of the Bulgarian property owners (vendors) wish that the "tax estimation price" is written in the title deed, and not the selling (asking) price which the buyers are paying, so due to this practice there might be discrepancies between the price that you are paying and the price written in the title deed.

When an individual comes to sell a property in Bulgaria, the same system works with a tax evaluation prior to the Notary Act.

In general, if a purchaser wishes to reflect a value higher than the tax evaluation on the Notary Act, extra costs incurred as a result of this action are paid by the purchaser. With particular reference to "off plan purchases", extra costs will include extra notary fees, municipality taxes and VAT and can increase the purchase price by up to 14%.

* It is important to note that the tax evaluation is set by the local municipality and Smartbuy Afrodite International Investments accepts no liability for the content of the tax evaluation.

Mortgages
Smartbuy Afrodite International Investments are able to recommend Banks and other mortgage lenders who will be able to advise as to whether it is viable for you to make an application for a mortgage in Bulgaria.

Points you should consider are:
• Mortgages are available for off-plan properties once they reach roof level
• stage of construction
• Mortgage companies will lend up to 70% of the declared notary value
• Interests rates are usually between 6.5% and 7.5%
• Mortgages terms are up to 20 years only
• Arrangement fees are between 1000 - 2000 Euro approx

Overseas Mortgages
There are currently only a few mortgage lenders that will assist with financing property in Bulgaria. A cheaper option may be to look to raise the capital in your country instead.

Top 10 Tips For Buying In Bulgaria

1. Don't impulse purchase, always allow yourself a cooling off period if you see a must-have property and are tempted to put down a deposit there and then. A property investment is an expensive purchase and you must be satisfied in your own mind it is what you want.
2. Buy from a company that has at least 3 years experience in the Bulgarian property market and ideally has offices in another European Country.
3. Do not sign a contract in a foreign language unless you are completely satisfied.
4. Consider combining your financial resources with friends or family it could enable a villa with pool to be within your financial reach, rather than simply an apartment.
5. If possible try to arrange your mortgage finance in principle, before agreeing to purchase the property, or before signing any contracts and paying over a deposit.
6. Check with the Estate Agent or vendor that you are aware of the costs charged by the government and legal authorities for purchasing a property in Bulgaria.
7. Remember that you will have additional bills to add to the sale price such as Lawyer's fees, Taxes, Insurance and Maintenance etc. which must all be met in the host country. The Notary deed fee and late payment penalties also need to be taken into account.
8. When buying residential property consider seeking specialist advice (i.e. solicitors etc) before committing to a purchase overseas. They should be proficient in the country's laws and processes and know the specifics involved in buying a property there. They should also ensure you don't inherit any debt on a property before you purchase - i.e. if the developer has borrowed money to build the development and this amount has been allocated against each plot as additional security to the developer's bank.
9. Set up standing orders in a local Bulgarian bank account to meet bills and taxes.
10. If you will wish to rent your property then ensure the company you purchase through are able to provide that service and are able to manage and promote it properly on your behalf.

Smartbuy Afrodite International Investments is able to assist you through every stage of the research and buying process for your Bulgarian investment decision, whether it's for a private holiday home, a rental or commercial property purchase. As a professional consultancy service with dedicated, experienced staff, we are able to help you make a more informed decision, answer any questions you may have throughout the process and make your purchase an altogether enjoyable experience.