Many home buyers decide to work with a developer. The advantage for buyers here is that both the construction work and the completion of the house as well as the rights to the land come from a single source via the developer. The developers must make advance payments for the construction work and for the acquisition of the developer's land. To do this, they take out large bank loans. If this results in payment arrears, for example because purchasers withhold payments due to defects, developers must manage to close the financial gap or delays in payment transactions. If they fail to do so, they face insolvency.
If a developer has to file for insolvency, this has a major impact on the further course of the construction project. To protect themselves from the consequences of insolvency, purchasers should have their interests represented by a lawyer as soon as possible. The first decision to be made here is whether the purchasers wish to continue building or withdraw from the contract. If they continue with their building project, it must be guaranteed that the property is attributed to them and not to the insolvency administrator or the developer bank. This is because the developer bank is listed in the land register before the purchasers and the insolvency administrator also represents other interests.
Another option would be to rescind the contract. To ensure that the purchasers have a certain degree of legal protection when working with a property developer, regulations from the Brokerage and Property Development Ordinance (MaBV) must be complied with. When notarizing the property development contract, the notary ensures that these legal provisions are complied with.
Source: bautipps
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