How to avoid being cheated when selling Bulgarian property

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How to avoid being cheated when selling Bulgarian property

Postby Admin » Wed Apr 10, 2013 12:13 pm

Dear members,

the present article pursues the goal to increases your attention to the cases where you wish to sell your Bulgarian real estate from abroad, via authorizing local person (a proxy or intermediary) in cases where they have offered to you to sell the real estate for a concrete price, and “kindly” offer also to sign on your behalf the Title Deed for sale before local Bulgarian notary. In the last year there occurred numerous cases, where authorized physical individuals-proxies or intermediaries, have cheated the sellers who initially authorized them - the asked and achieved by the proxy sale price turned to be bigger than the one the seller was initially promised by the proxy to receive. The Bulgarian Law finds it difficult to protect the rights of the authorizers-sellers, who have not got a representation contract, but have only unilaterally given full rights towards various physical individuals with signed letters of authorization, so we hope the present article will be helpful for you in your future actions.
A simple scheme has occurred: A local person has been asked by the overseas seller to find a buyer for their own real estate, for concrete price (usually proposed or placed by the local proxy); where the seller agrees and authorizes the proxy to perform the property transfer and to receive the sale price on their behalf. But a higher sale price has been listed to the buyer. Once the buyer agrees on this (higher) price, then likely a lower price is placed by the proxy to the seller, who usually agrees with this exception, because they need the fresh cash. The buyer has been advised also to agree with the “Capital Gains issue” explanation about putting much lower price in the new Title Deed which is to be signed by them and by the seller’s proxy, where the buyer is also instructed by the proxy to pay the difference to the proxy to them only, but never – directly towards the seller overseas. There is never a direct contact (neither direct payment), between the seller and the buyer. Then the smaller price, confirmed by the seller, is being transferred to them - as the seller usually does not care about the text of the new signed Title Deed, neither about the contact details of the buyer or what will happen with the property from then on, they close the case and are happy to spend the received sale price. But in certain above detailed cases the reality could be quite different and the difference between the paid by the buyer and the given to the seller, only goes to the proxy who keeps it, cheating in this way the trustful seller who authorized them.
How to avoid such a negative scenario:
1) Asking a legal practitioner: Don’t play “smart” and get a lawyer when selling your Bulgarian property, in cases where needed signing on your behalf the new Title Deed and opening local bank accounts in your name (or worse - in the name of your company) for receipt of the sale price. Local lawyers are regulated by Bar, they are contracted to their clients and they have business insurance for damages to clients. Lawyers use to respect the interests of their clients – they will put you in direct contact with the buyer and will present report to the client after completion of the sale (incl. a translated copy of the new, signed by them Title Deed so the seller may see the actual listed sale price). Other physical individuals, proxies or trading intermediaries are not legally regulated, they are not contracted to you an may only receive rights from you via the letters of authorization (this is why it is not named “power of attorney”, and couldn’t be named so); per the local legislation they don’t have liability to you - because a letter of authorization is not a contract, this should be clear.
2) History of communication and representation: One very important advantage to hire a lawyer is that they don’t cease business suddenly and they always use to keep records. Any document which you may have previously sent or posted to your lawyer is kept by them, and anytime later when needed, even years later, you can always ask for a copy, in case you have lost it for some reason. So you will avoid a situation where you have not kept a copy of the letter of authorization with many rights, which you have signed to a person who is not in business any longer and who you can’t get in contact with anymore. Considering the above detailed cheating schemes, it is very important who holds the letter of authorization and who has a copy of it in case of need. Lawyers also keep a history of their correspondence; they use to present a report to their clients for the job done.
The problematic authorizations unfortunately occur sometimes. Unfortunately, instead of many EU countries, here the local Bulgarian legislation does not regulate the business activities of intermediaries and does not establishes personal liability and insurance for damages towards clients on the base of letter of authorization only. This is why appointing a reputable local property lawyer to represent you and to perform the sale of your Bulgarian real estate is advisable. Couple hundreds Euro spent for legal services could secure receipt of thousands of Euro and grant successful protection of your legal and financial interests in your capacity of seller of Bulgarian property. If you need concrete assistance or guidance on the above matter, contact us: support@bulgariandeals.com


Bulgariandeals Team

Bowen
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Joined: Mon Apr 15, 2013 1:10 pm

Re: How to avoid being cheated when selling Bulgarian proper

Postby Bowen » Mon Apr 29, 2013 6:00 am

Hi Admin,
In my last comment I asked for tips to avoid cheating while buying Bulgarian property through eBay, luckily found this selling threat here. I will be kind if you will share some tips to avoid being cheated when buying Bulgarian property also. If you have such threat then kindly redirect me to the threat. Thanks in advance.

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