Estate Agency Purchase Agreement: Why a Lawyer Review? · VLKOVÁ
A Purchase Agreement from an Estate Agency: Why Have It Reviewed by a Lawyer Before Signing?
Buying real estate is, for most people, the largest financial investment of their life. Although estate agencies usually supply their own draft purchase agreements, their primary goal is to broker the deal and protect their own commission. A lawyer acts as your personal legal representative, who assesses the agreement from your perspective (e.g. as the buyer), uncovers hidden risks, tailors contractual penalties and the conditions for releasing the purchase price to your situation, and is liable by law for any damage through their professional insurance.
JUDr. Zuzana Vlková, PhD.·Advokátka··4 min read
1st round of revision
Review of a purchase agreement (transfer of a flat) – developer project
450 EUR
1st round of revision
Review of a purchase agreement (transfer of a family house) – developer project
400 EUR
1st round of revision
Note: The cost for a transfer agreement supplied directly by a developer is higher due to the more complicated contractual structure and the volume of legal documentation. Where further negotiation of the agreement is needed, we typically charge for amendments in the range of 1–2 hours at our hourly rate.
Buying a flat, a house or land is, for most people, a fundamental life step and an investment they save for over many years or commit to decades of mortgage repayments for. Once you have found your dream property and the estate agency sends you a draft purchase agreement, the natural reaction is relief and an urge to get the signing done as soon as possible.
Yet it is precisely at this moment that the greatest risk arises. Signing a purchase agreement is a legal act with an enormous financial impact, and relying solely on a text prepared by the broker may not pay off.
What is the estate agency's role, and what should you (not) expect from it?
At the outset, it is important to understand the difference between the roles of the individual actors in the transaction. The estate agency acts as a broker. Its primary interest is to bring the seller and the buyer together, negotiate the terms and successfully bring the deal to a close, thereby earning its commission.
Standard agreements from estate agencies are mostly universal, pre-prepared templates. Even if the agent tells you the text was prepared by a lawyer, you need to bear three fundamental things in mind:
A lawyer cannot represent both sides: By law, a lawyer cannot protect the interests of both the buyer and the seller at the same time.
Agreements protect whoever pays: The agency's primary client is the seller, alongside the agency's own interest (particularly its entitlement to commission). The agreements are therefore naturally set up in their favour.
The responsibility remains with you: If a problem arises during or after the transfer or at the Land Registry (kataster), the estate agency will disclaim responsibility, pointing out that you could have had the agreement reviewed yourself. Moreover, it never guaranteed you the provision of legal services, as it is not authorised to provide them.
What do you gain if a lawyer reviews the agreement before signing?
Involving your own lawyer in the property transfer process brings fundamental advantages the broker cannot guarantee:
Legal representation solely in your favour: The lawyer evaluates the agreement purely from the perspective of your interests and your specific situation (a secure method of financing, conditions for releasing the funds, defects in the property, options for withdrawal, balanced contractual penalties, special requirements as to the move-in date, and so on).
A tailor-made agreement: Instead of a generic template, you get an agreement in which all the contractual terms are set out in detail, increasing the level of your protection.
Statutory liability and insurance: An estate agency is not insured against liability for damage; a lawyer is.
How does the lawyer's review of the agreement work?
The whole process is simple and does not slow down the smooth course of the property transaction:
Sending the documents: You forward the estate agency's draft purchase agreement (or reservation agreement) to the lawyer by email, together with your requirements and information about the financing.
Legal analysis and risk identification: The lawyer examines the text of the agreement, verifies the legal status of the property on the title deed (list vlastníctva) and flags risky or unbalanced provisions.
Revisions: The lawyer prepares a proposal of specific changes and additions in tracked-changes mode.
Communication with the other party: After agreeing with you, the lawyer explains the comments directly, in the form of annotations, to the estate agency or the other contracting party, relieving you of technical legal discussions.
The revised text of the agreement can be sent to the other party either by you or by the lawyer on your behalf.
The other party responds as to which comments it does or does not accept and which it wishes to negotiate further.
An investment in certainty
The price of a professional review and mark-up of the purchase agreement by a lawyer represents a negligible fraction of the total purchase price of the property. Yet it can protect you from lost savings or years of litigation.
Are you about to sign a purchase agreement from an estate agency? Send us the draft for a professional review. We will uncover hidden risks, adjust the terms in your favour and ensure the entire transfer is fully safe for you.
