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The debit power of attorney in the sales contract

What is a debit power of attorney?

As the seller, you agree in the sales contract that your property or your Property for financing purposes by the buyer burdened becomes. You give the buyer a power of attorney to debit. In this, you authorize the buyer to pledge your property to the bank financing the purchase price and to subject you as the current owner to immediate foreclosure from the land charge. So the buyer finances the Purchase price through a bank loan and secures the bank with a land charge on your property. Personal debtor of the loan is solely the buyer. Only he owes the repayment of the loan secured by the land charge. When you sell real estate, you as the owner simply make your property available as a liability object.

Risks of a power of attorney

As Seller wear You with the power of attorney, of course a riskthat the buyer has encumbered your property with a land charge and this land charge must be deleted again in the event that the purchase contract is reversed. Conversely, the buyer bears the riskthat he pays you the purchase price financed by the land charge and that you can no longer refund the money in the event that the purchase contract is reversed. At the same time, the registration of the land charge is in the buyer's interest:

He can finance the purchase price with the land charge as security. It is also in your interests as a seller: you can be sure that the buyer will pay the purchase price.

Limitations of the Risks of Debt Authorization

To those associated with a debit power of attorney Limit risks, holds the land register law with regard to the individual case a number of Precautionary measures ready. As your real estate agent for Berlin and the surrounding area, we would be happy to provide you with more information.

  1. The debit power of attorney is regularly restricted in the purchase contract to the effect that it just before Notary use may be made, who also notarizes the purchase contract and is entrusted with the execution of the purchase contract.
  2. The debit power of attorney authorizes the buyer to order a land charge in an unlimited amount or up to a certain amount above the purchase price. In order to the buyer has the option, including the real estate transfer tax, brokerage commission, land registry fees or renovation expenses finance. If the value of the property is higher than the agreed purchase price, the buyer can not only encumber the property up to the value limit.
  3. To you as Securing seller, the buyer assigns his payment claim against the bank to you as the seller in the purchase contract and instructs the bank to make payments up to the amount of the purchase price only to your account or to a creditor to be replaced or to an escrow account of the notary. The Notary is commissioned to do this, the bank over this Assignment to inform.
  4. In the event that the purchase contract has to be reversed, the buyer undertakes to have the land charge deleted immediately.
  5. The buyer undertakes in the Land charge a Declaration of purpose to record. In the event that the purchase contract is reversed, the bank may only make the deletion of the land charge dependent on the repayment of the amount of money that may have been paid out to the seller. However, it cannot demand any further claims such as estimated costs, acquisition fees or commitment interest.
  6. As Seller take over according to the purchase contract in connection with the land charge no personal payment obligations to the buyer's bank. The buyer undertakes to exempt you from all costs and consequences of establishing the land charge.

You see They see: Executing sales contracts can be complex. A debit power of attorney is a valuable instrument for processing the sales contract quickly, taking into account the interests of both parties. As a real estate agent in Berlin-Spandau, we are happy to provide you with all-round service with advice and action. We understand what you might think of as “notarchist” and explain the context to the parties in a detailed and understandable way.