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Understand the Pirkimo-Pardavimo Sutartis

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When it comes to buying real estate in Lithuania, making sure you fully grasp the property sales contract is essential.

Indeed, not fully understanding the document you will sign can lead to financial losses, including the forfeiture of deposits, payment of penalties, unexpected costs, legal expenses, and potential poor investment decisions.

We've heard countless stories of people making costly mistakes when signing their property agreement in Lithuania. We want to help you avoid the same experience.

We'll give here a very brief overview regarding the property sales contract in Lithuania ; if you want a full checklist, please check our property pack for Lithuania.

What is the Pirkimo-Pardavimo Sutartis in Lithuania?

In Lithuania, the property purchase agreement is an essential document in real estate transactions.

Locally, it's referred to as "Pirkimo-pardavimo sutartis." This agreement formalizes the terms and conditions agreed upon by both the buyer and the seller. It is legally binding, meaning once signed, both parties are obligated to fulfill their respective duties as outlined in the agreement.

The agreement acts as a guarantee for both the buyer and the seller.

For the buyer, it ensures that the property will be transferred to them upon completion of the agreed terms, such as payment. For the seller, it guarantees that they will receive the agreed payment in exchange for the property.

International buyers or non-residents face additional considerations. They may need to comply with specific regulations, such as obtaining permission from the relevant

Lithuanian authorities before purchasing certain types of property. This is particularly true for agricultural land.

Typically, the property purchase agreement in Lithuania is signed after initial negotiations and once both parties agree on the terms. Before signing, a due diligence process is recommended to check for any legal encumbrances or issues with the property.

A deposit is usually involved, which is a percentage of the purchase price. This acts as a sign of good faith and commitment to the transaction.

The exact percentage can vary, but it's commonly around 10% of the purchase price. This deposit may be forfeited if the buyer backs out of the deal without a valid reason as specified in the agreement.

The process in Lithuania may differ from other countries in terms of the legal requirements, the process of obtaining permission for foreign buyers, and perhaps specific local practices in conducting real estate transactions.

For example, in some countries, the real estate transaction process might be more streamlined or less regulated, especially for international buyers.

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What should be included in the property purchase agreement in Lithuania?

In Lithuania, the property purchase agreement, or "Pirkimo-pardavimo sutartis," must adhere to certain legal requirements and typically contains several key components.

Firstly, the agreement should include comprehensive details of both the buyer and seller, such as their names, addresses, and personal identification information.

The full description of the property being sold is also crucial. This includes the property's address, size, boundaries, and any other relevant physical attributes or legal descriptions.

The Lithuanian Civil Code, particularly the sections dealing with property rights and contractual obligations, governs the requirements for these agreements. This code specifies the necessary legal framework and conditions for real estate transactions, ensuring they are conducted lawfully and fairly.

Mandatory clauses in the agreement typically cover the sale price, payment terms, and conditions, including the amount and due dates.

The responsibilities and rights of both parties should be clearly defined. This includes any obligations related to property conditions, taxes, or other liabilities associated with the property.

Additional clauses often address specifics like the transfer of utilities and services, arrangements for the handover of keys, and any warranties or guarantees. It's not uncommon for agreements to include dispute resolution methods, specifying how any disagreements between the parties will be handled.

Conditions or contingencies are often included to protect both parties. These might involve the buyer obtaining financing, the property passing a certain inspection, or the sale being contingent on the buyer selling their current home.

In Lithuania, the property purchase agreement typically needs to be authenticated by a notary. This notarization process ensures that the document is legally binding and that all parties understand their commitments.

The notary also checks the legal capacity of the parties and the legality of the document.

Real estate agents in Lithuania play a significant role in facilitating the transaction. They often assist in negotiating terms, preparing the initial agreement, and guiding both parties through the process.

However, their involvement does not replace the legal necessity of notarization.

What's the signing process like?

In Lithuania, the signing process of a property purchase agreement, or "Pirkimo-pardavimo sutartis," in a real estate transaction involves several steps and requirements.

Both the buyer and seller must sign the agreement. It's a bilateral contract, meaning it involves mutual obligations and rights for both parties.

The buyer or the seller can indeed be several people; in such cases, all individuals involved must sign the agreement. This is common in situations where the property is co-owned or being bought by more than one person.

The documents and information required from both parties typically include personal identification documents (like passports or national ID cards), proof of ownership from the seller, and potentially proof of funds or mortgage approval for the buyer.

Additional documents may include a cadastral (property) certificate and an energy performance certificate for the property.

Regarding the steps and timeline for signing, it usually goes as follows:

Steps Description


Both parties, often with the help of real estate agents and lawyers, negotiate and prepare the initial agreement. This can take days to weeks depending on the complexity of the transaction.

Review and Finalization

Once the agreement is drafted, both parties review it, potentially making revisions. This stage could take a few days to a week.


The actual signing of the agreement typically takes place in the presence of a notary. The notary ensures that all parties understand the agreement and that it complies with Lithuanian law.

Can the agreement be signed remotely? In some cases, digital signing is possible, but the involvement of a notary often requires at least one in-person meeting.

The specific process may vary, especially considering ongoing advancements in digital legal processes.

There isn't a universal deadline for signing; it's usually determined by the terms agreed upon by both parties. However, once an offer is accepted, the signing usually happens within a reasonable timeframe, often within a few weeks.

The duration for which the contract is valid can vary. It typically remains valid until all obligations are fulfilled, such as the payment of the purchase price and transfer of the property. This duration is often specified in the contract itself.

Registration with local authorities in Lithuania is a crucial step.

After signing, the agreement and the change of ownership need to be registered with the Lithuanian Real Property Register. This registration is the final step that officially transfers ownership and is typically handled by a notary or legal professional.

Amendments to the contract after it has been signed are not common since it's a legally binding document.

Any changes would require agreement from both parties and potentially a new signing and notarization process.

The typical timeframe for completing all necessary paperwork and approvals after signing varies but usually takes a few weeks. This includes the time for notarization, registration, and any other administrative procedures required to finalize the transaction.

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How is the payment handled when signing a property purchase contract in Lithuania?

In Lithuania, understanding the financial aspects of a property purchase agreement is crucial for a smooth transaction.

Here's a breakdown of what you need to know.

When signing the sales agreement for a property in Lithuania, you're typically required to pay a down payment. The typical down payment percentage for a property sale is around 10-20% of the purchase price, but this can vary based on the agreement between the buyer and seller.

There can be upfront fees or costs associated with signing the sales agreement. These may include notary fees, legal fees, and potentially a real estate agent's commission if one is involved in the transaction. These costs should be clarified before signing the agreement.

Regarding the payment, it's usually made to an escrow account rather than directly to the seller. This provides a layer of financial security for both parties.

The payment due date is typically specified in the agreement. It's not always immediate upon signing but can be set at a later date, such as upon completion of certain conditions or at the closing of the sale.

There are tax implications and property transfer taxes associated with the payment. In Lithuania, there is a property transfer tax, and the buyer is usually responsible for this cost.

The exact amount can vary, so it's essential to understand this aspect before finalizing the sale.

The down payment amount can sometimes be negotiated with the seller. However, this depends on the seller's willingness and the market conditions.

If the sale falls through, the fate of the down payment depends on the terms of the agreement. It can be refundable under certain conditions, such as a failed inspection or a financing contingency not being met. It's crucial to have these conditions clearly stated in the agreement to protect your deposit.

Regarding the use of a mortgage loan for the down payment, this depends on the terms of your mortgage. Some lenders allow this, while others require the down payment to come from personal funds.

An attorney or real estate agent can play a significant role in handling the payment process. They can ensure that all financial transactions comply with legal requirements and that the funds are correctly transferred.

You should definitely request a receipt or confirmation of payment when making the down payment. This serves as proof of your compliance with the terms of the agreement.

For tax implications, the buyer typically faces the property transfer tax, as mentioned earlier.

The seller might have to deal with capital gains tax, depending on how long they owned the property and the profit made from the sale.

What are the potentials risks and pitfalls?

You might be interested in reading our article about the common risks and pitfalls surrounding a property transaction in Lithuania.

Understanding the risks and pitfalls associated with property purchase agreements in Lithuania is vital for a smooth transaction.

Let's delve into the specifics.

Both the buyer and seller can withdraw from the agreement under certain circumstances. The conditions under which withdrawal is permitted are usually outlined in the agreement itself.

Common reasons include failure to secure financing, significant property defects discovered after agreement, or non-compliance with terms by the other party.

In Lithuania, there's typically no statutory cooling-off period for real estate transactions once the agreement is signed. However, parties can negotiate and include such a clause in their contract if desired. If included, the duration and specifics, like whether weekends are counted, should be clearly stated.

If a party withdraws from the agreement without a valid reason as stipulated in the contract, they might face penalties.

For the buyer, this often means losing their deposit. For the seller, they might have to return the deposit and potentially pay additional compensation.

If one party fails to fulfill their obligations, the other party may seek legal recourse. This could involve enforcing the agreement, seeking financial compensation, or terminating the agreement and seeking damages.

The process in Lithuania might differ from other countries, particularly in aspects like the cooling-off period, deposit requirements, and the legal framework governing real estate transactions.

For example, in some countries, a cooling-off period is a standard part of real estate transactions, which isn't typically the case in Lithuania.

Potential risks include misrepresentation of property conditions, legal issues with property title, and unexpected financial burdens like repairs or taxes. Buyers should conduct thorough due diligence, including a property inspection and a title search, to mitigate these risks.

Disputes are not overly common but can arise. They are usually resolved through negotiations between the parties, or if necessary, through legal arbitration or court proceedings. The agreement may specify preferred dispute resolution methods.

If defects or issues are discovered after signing, the course of action depends on the terms of the agreement and the nature of the defects. If the seller knowingly concealed issues, the buyer might have legal recourse.

Otherwise, it may depend on whether the property was sold 'as is' or with certain guarantees.

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.