Obtain a certified title record at the Land Registry Office
Agency: Land Registry office
Obtain an original certified title sheet at the Land Registry Office to check the current data of the property. The title sheet includes information on liens and outstanding taxes. According to the Hungarian law, the countersigning lawyer may use a title sheet which is issued within 30 days preceding the signing. Due to the amendment of the land registry rules, the fee of the hard copy of a certified title record was increased to HUF 6,250. Since January 1, 2010, the request for electronic land registry sheet is also possible for HUF 3,600 for certified sheet and for HUF 1,000 uncertified sheet. Please note that the printed form of the electronic certified sheet is not considered as certified land registry sheet.
Time and cost: Less than one day (online), HUF 3,600 (Hard copy certificate HUF 6,250; Electronic certificate HUF 3,600; and Uncertified sheet HUF 1,000)
The sale and purchase agreement is signed by a lawyer
Agency: Lawyer
After the negotiations between parties, a written sale and purchase agreement is required, and each page must be initialed/signed by the parties. The contract becomes valid by the countersignature of a lawyer (signature, the chamber identification number, stamp, dry stamp). The countersignature certifies the identity of the signing parties and that the content of the agreement is in accordance with the legal regulations and the will of the parties. The lawyers’ fees are subject to the parties’ agreement and may vary between 0.5 and 3% of the property value. Current market conditions have been pushing fees down to around 1% of the property value.
Time and cost: 1 day, HUF 2,070,652.64 (1% of the purchase price (lawyer’s fees) – subject to the parties’ agreement)
Obtain the extract of the purchaser from the Court of Registry
Agency: The Court of Registry, the Ministry of Justice, and notary public
Since the parties of the property transfer are companies, they should obtain an extract from the commercial registry both for the buyer and the seller. The extract (as well as the specimen of signature) is to be filed for both parties to the Land Registry Office. With the data indicated in the extract the officer can check that the legal entity really exists and that the manager is really entitled to sign for the company. The commercial register is public, so anybody can go there and ask for a company extract. The extract must contain the deleted and actual data of the company and may not be issued earlier than 30 days preceding the sale. In case the data of the seller have not been amended as of the date of purchase (or any further filing), it is enough to refer to this fact on the standardized application form, together with the case number in which the required documents had been filed. If no such reference is made, the cost of the extract is payable both in relation to the seller and the buyer. The cost varies according to the issuing agencies and the length of the extract. Generally, the cost is between HUF 3,000 and 7,000.
An electronic extract can be obtained via the e-mail ([email protected]) with pre-payment of the cost (HUF 1,980).
Time and cost: 1 day, HUF 5,000
Register the title at the Land Registry Office
Agency: Land Registry Offices of Capital Budapest Government Office
As of January 1, 2010, there are two Land Registry Offices operating in Budapest. The land registry offices accept specimen of signatures both from notary public and from attorney-at-law.
A new fast-track procedure has been introduced to reduce the registration time at the Land Registry for a higher registration fee of HUF 16,600. The registration fee for the regular procedure is HUF 6,600 according to Act 122 of 2006, effective February 4, 2007. As of January 2006, it is possible to retrieve a standardized application form online at: www.takarnet.hu.
The Registry office only accepts this standard form. Once the application has been submitted to the Land Registry Office, one set of the documents are forwarded to the stamp duty office. The purchaser then receives a letter from the stamp duty office and will pay stamp duty by postal check or bank transfer.
Note: Usually, if the purchaser does not pay the full purchase price at the signing of the contract, the vendor retains its ownership. (Such retention may be registered until the payment of the full purchase price). The application may request the registration of the sale with retention of ownership, or the registration of title. As of a regulation issued in January 2006, the seller may declare that he/she will request registration of the purchaser’s title at a certain date, but no later than 6 months from the date of the agreement. During this period the registration is pending, and no other registrations or applications may be fulfilled regarding the property. If the land registry office does not receive the consent from the owner of the property, the pending application is deleted. The fact of sale with retention of ownership is indicated on a side note within 24 hours from the submission. This means that an application was submitted about the property, but it was not verified by the Land Registry Office yet (not registered, not refused). For sales with retention of ownership, a declaration must be submitted stating that the title may be registered, simultaneously with the deletion of the retention of ownership. Following the submission of the declaration, a new side note will be indicated, and the title of the purchaser will be registered. Transfers of property might be subject to a 27% VAT.
As of 2010, the general duty rate on the transfer of property for consideration was reduced to 4% from 10% on up to HUF 1 billion (1,000,000,000) of the property value.
The documentation shall include:
- The standardized application form;
- Two original copies and one photocopy of the contract;
- Original extract of the purchaser from the commercial register;
- The company extract and the specimen of signature of both the seller and the purchaser are to be filed.
Time and cost: 15 days, HUF 8,299,210.55 (4% of property value (Stamp duty) up to value HUF 1 billion (or 2% for values above with a cap of HUF 200 million) + HUF 16,600 (registration fee, expedited Procedure), or HUF 6,600 (registration fee, regular Procedure))
