How do escrow accounts in Italy work and what are the real benefits?
A new law was introduced on 29 August 2017 2017 that allows the buyer to use an escrow account for the purchase of his Italian property.
The role is not entrusted to the real estate agent but to the notary who is in charge for the transaction.
Although it is not mandatory, it is highly recommended.
The property buyer can ask his notary to receive the funds for the payment of the purchase price / balance to be kept into the notary`s escrow account, before completion of the sale.
The funds are kept into the account until the “trascrizione della vendita”, the actual registration of the sale. Once the title registration is done, the buyer is sure the purchase has been completed successfully and the notary will transfer the funds to the vendor.
But why is it important to use an escrow account ?
When it comes to property purchase in Italy, it is suggested to use an escrow account as some things could potentially happen during the purchase time.
For example, the vendor could try to sell the same property to another buyer in front of a different notary.
Furthermore, there could be the risk that the property is frozen by private creditors before the official registration at the authorities.
How safe are escrow account in Italy?
In Italy, this type of account cannot be attacked by creditors and therefore, it benefits of a specific legal protection.
Also, according to law, funds can be used only for the payment of the property purchase.
Using escrow accounts eliminates the risk of default for financial difficulties.
Are you thinking or in the process of buying a property in Italy and have questions? Do not hesitate to contact us at email@example.com.
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