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Tips to remember when buying foreign property

You should never sign any contract relating to the house purchase that you do not understand.  This is of particular importance if the contact is not in your native language.

You should make sure that you obtain specialist advice from Surveyors, independent Solicitors and Architects before you begin the purchase process.  They will be specialists in the particular area and they will be able to provide you with professional advice on the processes involved in purchasing a house in a specific country and will make you aware of any applicable laws and taxes.

You should instruct your solicitor to check that you will not inherit a debt on the property prior to purchasing.  This can be the case if you wish to purchase a property on a new development and the developer has had to raise funds through external means.

Always ensure that you arrange for an Independent Valuation of the property to be undertaken.  This can help to highlight whether the property is overpriced and whether there are any specific problems with the house itself, such as poor wiring, etc.

Buying property can be an emotive exercise and it is possible to become caught up in the moment if you instantly fall in love with a property and place a deposit there and then.  If you find yourself in this situation, it is important that you attempt to cover yourself by negotiating a “cooling off” period.  Many people will need to raise finance in order to afford a new property, so you should seek to incorporate an opt out clause in your contract stipulating that should you be unable to raise funds for the purchase you will be able to pull out of the purchase and receive a refund of your deposit back in full.  Better still, try to arrange your finances prior to viewing properties so that you will at least have details of the maximum price you will be able to stretch to.

It is most advisable to arrange for a mortgage in the currency in which you earn your living.  If you are to receive rental income on the property in the local currency, you could consider arranging a mortgage in the local currency.  It is important that you open a bank account in the new country of your residence and obtain a Certificate of Importation for any money that you bring with you from your previous country of origin.

If you find yourself struggling for capital, consider pooling funds with friends or family.  If you are relocating and the new home will be your primary residence, this may not be the best option.  However, if the property is to be a holiday home, the extra revenues derived from pooled resources could get you a substantially larger and better equipped home than if you were purchasing alone.

Buying a property abroad will invariably mean you will be levied with unfamiliar bills and taxes by the government.  It is your responsibility to check with the relevant authorities as to what you will be expected to pay otherwise you could face court action and repossession of your new home – it may be wise to set up standing orders for the inevitable bills.  Similarly, you should check with your estate agent about general house purchase costs in the desired country as these can vary wildly between countries.

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