Closing costs are the total fees and other expenses that must be paid by the buyer in addition to the purchase price of the property. These charges - called frais de Notaire - encompass taxes (including VAT), professional fees, registration fees and the cost of preparing the various documents that must be filed with the local jurisdiction to record the sale.

The Notaire

Closing costs are paid by a single check or wire transfer to an official called a Notaire. The Notaire is a French lawyer who is trained specifically in French property law and officially licensed by the French government to execute real estate transactions. Without exception, all buying and selling of property in France must be done under the auspices of a Notaire.

The Notaire system is the key reason that real estate transactions generally go so smoothly in France. Once given the purchase price, the Notaire prepares an agreement of sale, called the compromis de vente (or promesse de vente) and all necessary paperwork. When all aspects of the transaction have been clarified, the Notaire calculates the funds required from the buyer to close the sale in conformity with the law. The notaire will notify the buyer well in advance of the exact figure that must be presented at closing to pay closing costs. Such payment may be made by certified checks or wire transfer. Signing the papers at closing generally takes about an hour.

For more information on the role of the Notaire, click here.

Calculating closing costs

One of the advantages of the French real estate process is that closing costs are fixed by law and can immediately be calculated within a few hundred euros once the buyer and seller agree upon a purchase price. Thus the typical real estate settlement takes place without the kind of unnerving surprises frequently associated with finalizing real estate transactions in other countries.

Closing costs include the Notaire's fees, administrative and filing costs, and all taxes.

A quick rule of thumb for calculating closing costs is:

• For properties more than five years old: approximately 6,5 -7,5 % of the purchase price.
• Properties constructed within five years before the date of settlement: 2-3% of the purchase price.

JUST FRANCE SALES can calculate immediately your closing costs within a few hundred euros once we know the agreed-upon purchase price.

Bear in mind that if you get a mortgage you will have as an additional expense of a loan acquisition fee of 1-1.5 percent of the loan value.

Selecting a Notaire

Just as lawyers vary in their legal skills, so do Notaires. Involving an incompetent Notaire in your sales transaction could turn what should be an easy process to a nerve-wracking affair. One of the services of JUST FRANCE SALES is to direct your transaction to a Notaire skilled in handling your kind of transaction.

For more information on how JUST FRANCE SALES can enlist the services of an experienced English-speaking Notaire for your transaction, click here.

Two Notaires: One for the seller, another for the buyer, at no extra cost.

Traditionally it is the Notaire chosen by the seller who prepares the agreement of sale and closing documents. The question arises: Should the buyer also have a Notaire to protect his or her interests?

In most countries, including the United States, the buyer is often faced with this very question - whether to pay the substantial fees necessary to retain a lawyer just to oversee an ordinary residential real estate transaction.

The buyer does not face this dilemma in France. Under French law, both buyer and seller are entitled to representation by a Notaire at no additional expense to either party. The frais de Notaire (discussed above), which are fixed by law, include professional fees for both Notaires. If the buyer chooses not to have a Notaire, the seller's Notaire retains all of the professional fee. If the buyer has a separate Notaire, the fees are shared evenly between the two. Thus in France the buyer may retain a Notaire - a wise decision - without paying additional fees.

Should a buyer need special assistance in resolving legal questions that lie beyond the scope of a normal sale (easements, side negotiations for the purchase of an adjoining parcel, etc.), the Notaire may charge for these services at a normal hourly rate.