Buying a flat in the Czech Republic? What to check before paying a reservation fee
The agent sends you a reservation agreement and says another buyer is interested. The purchase agreement will come later. You may already be committing to a fee and a deadline your bank cannot meet. Before reserving the flat, check what you are buying, when you can withdraw, and how the purchase price will be released.
What comes with the flat
Ask for a current Land Register extract and compare it with what you were shown. Check whether a parking space or storage room comes as a separate unit, a co-ownership share or a right to use the space. For a co-operative flat, check whether the transaction involves a transfer of a co-operative share.
If the register shows a pending change, find out what proceedings are under way and whether they could affect the transfer. Ask the seller for a statement from the person responsible for managing the building about debts that may pass to the buyer. Check planned repairs too. A new lift or roof can affect your monthly contributions.
When you get your reservation fee back
Check who receives the fee, whether it counts towards the purchase price and when it is refundable. If you need a mortgage, agree what happens if the bank declines the application, lends less than expected or misses the agreed deadline. Put those terms in the agreement you are about to sign.
When the seller gets paid
The purchase agreement, escrow terms and lender requirements need to work together. If the seller still has a mortgage, agree who pays the outstanding balance, how removal of the mortgage lien will be documented and when the seller receives the rest of the price. For each step, specify the evidence required and what happens if the Land Registry refuses registration.
The Land Registry may approve registration only after 20 days have passed from the date it sent notice of the pending change to affected parties. Allow time for the registration process when scheduling mortgage drawdown or handover.