The Buyer’s Guide

Bank Appointment

Before starting your journey to buy a property it is very important that a buyer set up a meeting with a Bank’s representative in order to verify the amount of loan that you are eligible to borrow based on your Income and savings. Due to our long-term relationship with all local banks, we can immediately introduce you to a banks representative who will organise the best loan package that suits your pocket and needs.

Decide on the type of property

Now that a you know the amount that the Bank is willing to lend you as a mortgage, you can set a budget and can decide which type of property you are able to buy and most importantly a property that you afford for example, a Terraced house, an Apartment with two or three bedrooms, a Penthouse etc and in which location because property prices vary according to locations. Don’t over-leverage yourself. While your new home may be your dream, don’t forget that you will need to set aside money for maintenance and everyday expenses, as well as other financial goals. Don’t spend everything on the house itself.

Choose a Property Consultant

Know when to, and who to, ask for help. Don’t ask the opinion of everyone you meet. You will end up with as many opinions as there are people to question. Conflicting opinions and advice do more harm than good. Buying a new home is a highly emotional commitment, as well as an important financial one.

A Property Specialist will make your buyers journey as easy and hassle free as possible and will guide and advice you step by step through every stage of your journey.

A Property Specialist will select the properties that match the buyer’s preferences and which are within your budget range. After you select your preferred properties the Property Specialist will then schedule a meeting with the owners of the properties to view the properties. One of a Property Specialist duties is to take care of the negotiating stage and make sure that you will purchase the property at the best possible price and conditions.

Konvenju (Promise of Sale or Preliminary Agreement)

When the buyer decides which property he wants to buy and the offer has been accepted by the seller and also agree on all the terms and conditions, the next step in the journey is to set up an appointment for a Promise of Sale or Preliminary Agreement known in maltese as Konvenju. 

A Promise of Sale is signed by a Notary. We always advice to appoint a Notary of your choice.  A Notary is a public official who acts for the government. The Promise of Sale is a legal document which will include all the details agreed between a buyer and a seller such as Price, Payment terms, if needed subject to a Bank Loan, any works to be undertaken by the owner, date of final contract and other clauses related to the agreement. 

The Notary will then register the Promise of Sale. At this stage a 1% provisional duty (part of the total 5% stamp duty) is payable on the value of the purchase. Usually in Malta, 10% of the amount of the purchase price is also deposited at the Notary at the Promise of Sale stage. Once the Promise of Sale is signed, the notary will carry out searches on the history of the property to ensure that it can be transferred freely.

Notary fees are normally about 1.5% to 2.5% of the property price. For the exact fees, visit https://www.notariesofmalta.org/members/calculators/bills/ where an itemized bill calculator is provided.

Appoint an Architect

Appoint an architect of your choice to make a property inspection and check if the property is according to the Planning Authority Permits.

Follow Ups

If you signed the Promise of Sale with the clause ‘ Subject to Bank Loan’, it is very important to keep in mind the time frame at which you are obliged to let the Notary and Seller know that your loan has been approved and you have a sanction letter in hand. On the other hand, if your Loan has been declined by the bank, it is very important to inform the Notary and the seller with a signed declined letter from the bank within the time frame agreed on the Promise of Sale.

During the same period a plan and site plan of the property on Land Registry stationery needs to be provided and handed over to the Notary so that an official search at the Land Registry may be affected. In the meantime, the Buyer should also ensure that the House and Life insurance policies requested by the Bank are in place and paid up.

Final Contract

If the buyer is going to take a loan from a commercial bank, the Notary has to present all relevant documents to the Bank’s legal office for vetting prior to the final contract.

The Final contract is drawn up by the buyer’s notary. Once all terms set down in the Promise of Sale have been fulfilled, the parties get together to sign the final deed of sale. The balance of the purchase price is paid to the vendor, and the balance on the stamp duty is due, and the notary’s fees are also paid. The keys to the property are handed to the new owner, and the notary registers the contract of sale at the public registry.