Anyone who sells without an estate agent ultimately signs the same notarized purchase agreement as any other seller—but bears sole responsibility for understanding and reviewing the draft. Your security and money depend primarily on four components: the exclusion of liability, the payment terms, the security in the land register, and the handover. We explain what you, as a private seller, should look out for in the agreement and where the typical pitfalls lie.
Who Drafts the Purchase Agreement—and Why You Must Review It
When selling real estate, notarization is mandatory (Section 311b of the German Civil Code (BGB)). The notary prepares the draft agreement. They are required to remain neutral and instruct both parties—but they are not your personal representative. The standard draft is often based on information provided by the buyer and the financing bank. This makes it all the more important that you read the draft thoroughly.
If a consumer is involved on one side, the notary generally must make the draft available to you two weeks before the notarization appointment. Use this period: note any unclear points, clarify open questions with the notary’s office, and communicate requested changes in good time before the appointment—not only at the signing table.
The Exclusion of Liability: the Most Important Point for Sellers
When selling a used property, the warranty for material defects is usually excluded in full. Wording such as “bought as seen” or “to the exclusion of any liability for material defects” is standard. As a private seller, you may agree to this exclusion—unlike a commercial property developer, who may not go this far in relation to consumers.
However, the exclusion has one crucial limitation. Under Section 444 of the German Civil Code (BGB), the seller may not invoke it
insofar as the seller fraudulently concealed the defect or assumed a guarantee as to the condition of the item.
For you, this means two things:
- Disclose known, hidden defects. You must actively provide information about damage you know of that a buyer would not notice during a normal viewing—for example, a damp basement, dry rot, contaminated land, or unauthorized alterations. Concealing such a defect, the exclusion of liability will not help you, and the buyer may later reduce the purchase price, withdraw, or claim damages.
- Be careful with assurances. Specific statements about features – “roof completely re-covered in 2020,” “no damp” – may be deemed an agreement on the property’s condition or a guarantee. In that case, you remain liable despite the exclusion. Describe the condition honestly, but do not promise anything you cannot substantiate.
Important: The exclusion applies only to physical defects, not legal defects. You must ensure a transfer free of encumbrances – meaning the cancellation of your own land charges – in any event.
Payment terms: When and how your money will flow
A common misconception: that the purchase price becomes due when the contract is signed before the notary. That is not correct. The amount becomes due only when the notary sends you and the buyer the so-called notice of maturity. He sends this as soon as all prerequisites agreed in the contract have been met. Typically, these include:
- the registration of the priority notice of conveyance in favor of the buyer,
- the cancellation documents for encumbrances still registered against your property (such as your own bank’s land charge),
- the municipality’s waiver of its statutory right of first refusal (negative clearance certificate),
- where applicable, the property management’s consent in the case of a condominium.
The contract also specifies a concrete payment period, usually ten to fourteen days after receipt of the notice of maturity. Make sure that this period is realistic and that the payment method is clearly regulated – today, as a rule, direct transfer to your account.
If the buyer fails to pay, the contract should contain two forms of protection: the buyer’s submission to immediate enforcement with respect to the purchase-price claim – giving you an immediately enforceable title without first having to sue – and a right of withdrawal with default interest. Both are customary; nevertheless, check that they are actually included.
Direct payment or notary escrow account? Advantages and disadvantages
There are essentially two options for the payment method. Direct payment to your account is the norm today; the notary escrow account – a trustee account held by the notary – is now used only in special circumstances.
- Advantage of direct payment – lower costs: No additional custody fee is incurred. Security arises from the fact that the notaryPayment is only triggered once the due-date requirements have been met.
- Advantage of direct payment – simple process: For the uncomplicated standard case, direct payment is quick and transparent.
- Disadvantage of direct payment – less flexibility: If several creditors are to be paid at the same time or payments are to be processed simultaneously with the eviction, it reaches its limits.
- Advantage of a notary escrow account – fiduciary security: In complex cases – such as several loans to be redeemed or staggered disbursement – the notary holds the money neutrally and pays it out according to fixed rules.
- Disadvantage of a notary escrow account – additional costs: The notary charges a separate fee for holding the funds, which you and the buyer save with direct payment.
Priority Notice of Conveyance and Authorization to Encumber: Security in the Land Register
Shortly after notarization, the notary arranges for the entry of the priority notice of conveyance (§ 883 BGB) in Section II of the land register. It secures the buyer’s claim to the transfer of ownership: Any subsequent disposition of the property is invalid “to the extent that it would frustrate or impair the claim.” For you, this means that from this point onward you can no longer sell the property elsewhere or encumber it anew – this is intentional and indispensable for a smooth process.
The actual transfer of ownership takes place later: through the conveyance (§ 925 BGB), the agreement in rem reached in the simultaneous presence of both parties before the notary, and the final amendment of the land register. This only takes place once the purchase price has been paid and the tax clearance certificate from the tax office concerning real estate transfer tax is available.
You should pay attention to the authorization to encumber. If the buyer is financing the purchase through a bank, the bank wants its land charge entered even while the property still belongs to you. To do this, you authorize the buyer to encumber your property. The risk: Your land register is encumbered even though you have not yet seen any money. Therefore, ensure that the authorization may only be exercised through the notary handling the transaction and that a security agreement obliges the bank to use the loan exclusively to pay your purchase price.
Handover: When possession, benefits and burdens transfer
A separate section of the contract governs the handover. Under § 446 BGB applies:
Upon delivery of the sold item, the risk of accidental destruction and accidental deterioration passes to the buyer. From delivery onward, the buyer is entitled to the benefits and bears the burdens of the item.
From delivery onward, the buyer therefore bears the operating costs, the pro rata property tax and the risk of accidental damage such as a fire. This leads to the most important rule for sellers: Do not hand over the property until the purchase price has been paid in full into your account. The contract usually links the handover date precisely to full payment.
Record the handover in a protocol – including all meter readings, the number of keys handed over and the condition of the property. If you sell a rented apartment, under the principle “sale does not terminate the lease,” the buyer enters into the existing tenancy; in that case, also hand over the rental deposit and the tenancy agreements.
FAQ on the purchase agreement for a private sale
Can I, as a private seller, completely exclude the warranty?
Yes. As a private seller, you may exclude liability for material defects in the contract; for existing properties, this is standard practice. However, the exclusion does not apply to defects that you fraudulently conceal, nor to qualities that you expressly guarantee.
Do I have to disclose defects even though liability is excluded?
Yes. You must disclose known defects that are not recognizable to the buyer. If you conceal them, the exclusion of liability under § 444 BGB does not apply, and you risk rescission or damages – often even years after the sale.
When do I, as the seller, receive the purchase price?
Not on the date of notarization, but after the notary’s notification of maturity. The notary sends it once, among other things, the priority notice of conveyance has been registered and the documents required to delete existing encumbrances are available. The payment period agreed in the contract begins upon receipt.
What happens if the buyer does not pay?
If the contract contains the usual submission to immediate compulsory enforcement, you immediately have an enforceable title and do not have to sue first. In addition, the buyer owes default interest, and you may withdraw from the contract subject to the agreed conditions.
Can I still have the purchase agreement amended?
Yes, up to notarization. The notary’s draft is a basis, not a Unchangeable document. You should discuss any requested changes – such as the payment deadline, handover date, or inventory included in the sale – with the notary's office before the appointment.
Conclusion: Understand the Contract Before Signing
In a private sale, there is no estate agent to review the draft contract for you – you take on this role yourself. The biggest levers for sellers are a carefully worded exclusion of liability together with honest disclosure of defects, clear payment terms with submission to immediate enforcement, and linking handover to full payment. Read the draft at your leisure, note down your questions, and ask the notary to explain every point you do not understand. This way, you will attend the notarization appointment safely and well prepared.