Understanding the Buying Process

Understanding the Buying Process

The buying process

The buying process in Bulgaria, is relatively straight forward, but for those of you that do not know the procedure, or the rules/laws of Bulgaria, it may be a something that could put you off the whole idea of moving to Bulgaria.

I have gone through the process in as much detail as I can below, and hopefully you will also see that it is not as difficult as it first looks and sounds. And that you can be the owner of a new property in as little as one day. If there is something that you can not grasp, and need more information, then please get in touch, and I will be happy to go through it with you.

 You have the choice of either buying the house in your personal name, or setting up a company and following company law, which can be a better option for alot of people. if you decide to set up a limited company, then here is a list of things that you will need to do and think about.
 

What will you need to buy the house in your private name?

* A passport, (which will be photocopied for each owner of the company, and the photocopy will be sent in with all the paperwork.) 

*An address for correspondence- I allow my clients to use my address, and then once they have moved and are settled in Bulgaria they can change it to their own address, if they wish. It means that if you are not in the country, all letters will come to me, and you will be kept informed of any bills or problems, that may occur. 

What will you need to set up a company?

* A passport, (which will be photocopied for each owner of the company, and the photocopy will be sent in with all the paperwork.)
* A company Name- this is completely up to you. You need to decide, what your company will be called, but in most cases as the company will not be trading and is only for buying the house, people tend not to worry so much. You will need to pick a name that is not used by anyone else. If the name that you want is used by somebody else, we can offer to change it slightly so that it is unique.
*An address for correspondence- I allow my clients to use my address, and then once they have moved and are settled in Bulgaria they can change it to their own address, if they wish. It means that if you are not in the country, all letters will come to me, and you will be kept informed of any bills or problems, that may occur.
 

Where do we start?

Once we have the details above in place, we will go and meet our lawyer, who can speak English, and will be the translator throughout the whole process.
* We will hand in the copy of the passport, and give him the information on the company name and address. Or info on you as an individual if you decide to buy it in your personal name. 

He will prepare all the paperwork, and we will be told to come back to the office in an hour. Perfect time for a cup of tea or coffee or a chat about the area, and to answer some of the questions that have been running through your mind.

* When the lawyer has all the papers ready, we will go to the notary office, and sign some papers to say that you agree to open a company and manage the company. You will make a signature specimen in front of the notary and the notary will sign to say that you are who you say you are.
* We then go to the bank and open a business bank account,  You pay 20 Lev charges/fees and deposit 2 Lev in the bank. You can add more to the bank, but as it is a business account, if you put in more, then this will affect the documents. The bank account will remain dormant, for as long as the company does. We will offer you a personal bank account at this time.
* We will then return to the office, where you will pay for the company set up service (220 pounds) and you will order a company stamp (35 Lev) There will be more papers to sign here too.
The lawyer will take all of the documents into the courts, and they will be processed- (this can take anything from 1 day to around 60 days, depending on how busy the court is) This does not mean that you can not buy a house, until the paper works are finished. We can still sign for a house with power of attorney or with a preliminary contract and a deposit. Once the company is registered, we will go to Targovishte and collect the papers, with the company registration number, and you will be asked whether you would like the papers and stamp back or for us to keep them here safe, until you arrive.
 

Buying the house

If you decide to buy the house in your personal name, then we will miss out the step above, and when the seller has all the papers ready

* The seller will bring all of the documentation on the property into the lawyers office, where we will check that everything is in order
This means:
* The plan/skitser of the house is upto date
* The council tax has been paid upto date
* A new government valuation is ready- Paperwork in Bulgaria should not be older than 6 months, if it is new copies will need to be ordered or old copies stamped to say it is still the same.
* The deeds are present, and the lawyer will check which names are on the deeds, and that each owner is present and agrees to sell and at the same price.
* If all papers are correct, then the seller's papers will be given to the notary office, along with your company and identification papers, so that the notary can prepare the deal to change the deeds into your name. Usually the notary requests one day to prepare the papers.
* Once the notary is ready, the buyers and sellers will go to the notary and sign all the paperwork. If you can not be present or the process as been delayed because the owner didn't have the right papers at the start, then you can give us or the lawyer power of attorney, and we will act on your behalf and sign everything at this stage.
* Once everything is signed, the notary gives all the papers to the courts, government officials etc. We will go back to the notary office, 24hrs later, and collect the papers in your name.
 

What needs to be done, once the house is signed into your name?

Once the house is signed into your name there are certain things that the new owner is obliged to do....
1. You have 2 months to declare the property purchase at the municipality- if this is not done in 14 days, you can risk getting a fine. I have seen other people be fined 100 Lev, as they were not informed by their agents.
2. You need to change the electricity and water into the company name- there is not a deadline on this, but you should get it done early to prevent problems later. For steps one and two we charge 100 Lev or 50 Euros.
3. Every march, you will have to pay the council/property taxes on any property that you own. The bill will be sent in the post to you, and if paid early you will get a 5% discount. You can split the payments over the year, if you decide or pay in one go.
4. For every company in Bulgaria, whether working or not, the managers need to provide the tax officials and government with a financial statement/ set of accounts each year.

This only needs to be done, if you buy a house in a company.

This needs to be done before the end of March, and given in to the tax office, and then you have 90 days after this to produce a second copy to the government and trade registry. With a deadline of June 31st. These both need to be done each year. For any that are not done, if they are noticed, you can risk fines of anything from 2000 Lev per manager up to 5000 Lev. So it is not really something to be taken lightly.

If there is something, that you would like to discuss in more detail, then please get in touch with me. I am here to help.