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T Perrin C
T Perrin C, Consultant: information en droit du travail
Category: French Law
Satisfied Customers: 1412
Experience:  8 years as a Senior judge at Paris Conseil de Prud'hommes (Paris Industrial Tribunal)
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I am in the middle of a French house purchase from to French

Customer Question

I am in the middle of a French house purchase from to French sisters.
I had an offer of 35,000 accepted and paid a deposit in March. the purchase was supposed to complete in may. All parties have signed the Compromis de Vente.
Just before the completion date, it was discovered that one sister had two bank loans or mortgages on the empty property. The amount outstanding was larger than my offer. I believe the bank with the biggest debt have a Court award against the seller for X,000 euros, and there would be a further balance to repay to the bank after the sale goes through. I also believe the seller is now challenging the amount the bank are claiming in court, but we have not seen any proof of this.
My questions are;-
1. why will the bank not just allow the sale to go through, and chase the debtor for the balance later ?
2. Does the clause penale, give me a facility to claim damages against the sellers for not completing the sale.
3. have you any suggestions to get this moving ?
Thanks
Submitted: 1 year ago.
Category: French Law
Expert:  T Perrin C replied 1 year ago.

1 - because the bank would lose any collateral they have. To authorize the sale they have to wave the security they secured when they granted the mortgage/the loan. To ensure that they collect the entire proceeds of the sale would require lot's of additional legal work on which they want to save.

2 - if you have a clause pénale in the compromis and the sale cannot be completed you need to summon the sellers to court after you have sent them an injunction to proceed with the sale (which they obviously will not be able to do)

3 - It looks to me like you are not going to be able to avoid consulting an avocat to guide you through these procedures. Before you do so, ascertain with him that his fees will not be higher that the clause pénale... (usually the clause pénale makes provision for the deposit to be paid back, plus a penalty amounting to the deposit)... In this case you'd be better off simply requesting the notaire to cancel the compromis and return the deposit...