Oral agreements are basically binding. There is no general requirement that agreements generally have a certain form. For many types of purchases, it is therefore simply enough to agree and shake hands. But this does not apply to the purchase of real estate. Then it is required that the agreement is in writing and that it meets certain other formal requirements. Otherwise, the agreement is not valid.
The regulations on the purchase of property can be found under the United States Property Regulation Act. It states that property purchases require a written purchase document containing both the seller’s and the buyer’s signatures. The purchase document must also contain information about the purchase price and a statement of transfer. By transfer declaration is meant an explicit statement from the seller that, by signing the purchase document and paying the purchase price, the property transfers to the buyer. Since the purchase document must contain information about the purchase price to be paid, this means that an agreement on a certain price that is made alongside the purchase document is invalid.
Terms must be included in the purchase document
It is not uncommon for the seller and buyer to make the property purchase subject to certain conditions. It is then important to remember that they must be explicitly included in the purchase document. The following conditions apply.
Terms affecting the completion of the purchase, ie the acquisition itself is made subject to conditions. This type of condition cannot be valid for more than two years after the signing of the agreement.
Conditions that mean that the seller waives liability if the property should be removed from the buyer, for example because no previous owner was the right owner of the property.
Terms that restrict a buyer’s right to transfer, apply for a mortgage, in or lease the right to the property.
When a property is sold, in addition to the purchase document, which is commonly called a purchase contract, a separate letter of purchase is often drawn up. If the purchase document stipulates that a purchase letter must also be drawn up, it means that the purchase’s completion is conditional on the purchase price being paid. The property purchase is then completed only when the buyer completes the payment for the property. If, in the purchase document, you enter conditions for the purchase, they must also be included in the purchase letter in order to remain valid. When buying a property, it is common for a down payment to be paid in advance by the buyer.
If the seller of the property is married, the other spouse’s consent to the sale is usually required.
The seller’s signature must be witnessed by two persons.
Application for law enforcement
A buyer must seek legal speed for the purchased property within three months of the purchase being completed. The application for legal speed is made at Lantmäteriet.