Seller Financing Agreement for Malta

Seller Financing Agreement Template for Malta

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Seller Financing Agreement

"I need a Seller Financing Agreement for a commercial property in Valletta, Malta, with a 15-year financing term starting March 2025, where the seller will retain a first-charge security interest and the buyer needs to maintain specific insurance coverage for a retail business."

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What is a Seller Financing Agreement?

The Seller Financing Agreement is utilized in Malta when traditional bank financing is not preferred or available, allowing property sellers to act as lenders. This arrangement is particularly relevant in scenarios involving commercial properties, family transactions, or situations where conventional financing terms may not suit the parties' needs. The document must comply with Maltese legal requirements, including the Civil Code of Malta and financial services regulations, while also adhering to EU directives. It typically includes detailed terms about the property transfer, financing conditions, security arrangements, and both parties' obligations. The agreement's structure reflects Malta's unique legal framework, combining elements of both property and financial services law to create a comprehensive document that protects both seller and buyer interests.

What sections should be included in a Seller Financing Agreement?

1. Parties: Identification of the Seller/Financier and the Buyer/Borrower with full legal names and addresses

2. Background: Context of the transaction, including property details and parties' intention to enter into a seller financing arrangement

3. Definitions: Definitions of key terms used throughout the agreement

4. Sale and Purchase: Core terms of the property sale including property description and purchase price

5. Financing Terms: Details of the financing arrangement including principal amount, interest rate, term, and payment schedule

6. Security and Collateral: Description of security interests, including mortgage or charge over the property

7. Representations and Warranties: Statements of fact and assurances from both parties

8. Buyer's Covenants: Ongoing obligations of the buyer including property maintenance, insurance, and payment obligations

9. Seller's Covenants: Ongoing obligations of the seller including title warranties and documentation

10. Events of Default: Circumstances constituting default and consequences thereof

11. Remedies: Rights and remedies available to parties in case of default

12. Transfer of Title: Conditions and process for transferring property title

13. Notices: Process and requirements for formal communications between parties

14. Governing Law and Jurisdiction: Specification of Maltese law as governing law and jurisdiction for disputes

15. Miscellaneous: Standard boilerplate provisions including severability, entire agreement, and amendments

What sections are optional to include in a Seller Financing Agreement?

1. Early Repayment: Terms for early loan repayment, including any penalties or incentives - include when early repayment is permitted

2. Property Management: Specific requirements for property maintenance and management - include for commercial properties

3. Insurance Requirements: Detailed insurance obligations - include for high-value properties or commercial properties

4. Guarantees: Terms of any additional guarantees - include when there are third-party guarantors

5. Assignment and Transfer: Rights to assign or transfer the agreement - include for commercial transactions

6. Tax Provisions: Specific tax-related obligations and arrangements - include for complex transactions or commercial properties

7. Property Use Restrictions: Specific limitations on property use - include for properties with special conditions or commercial properties

8. Third Party Rights: Rights of third parties under the agreement - include when relevant third parties are involved

What schedules should be included in a Seller Financing Agreement?

1. Property Description: Detailed legal description of the property including boundaries and included fixtures

2. Payment Schedule: Detailed amortization schedule showing payment dates, amounts, and interest calculations

3. Property Condition Report: Detailed description of property condition at time of sale

4. Title Documents: Copies of relevant title documents and searches

5. Insurance Requirements: Detailed specifications of required insurance coverage

6. Property Plans: Official property plans and drawings

7. Energy Performance Certificate: Current energy performance certificate as required by law

8. Outstanding Works: List of any pending repairs or improvements agreed between parties

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Financial Services

Property Development

Construction

Commercial Property

Residential Property

Banking

Legal Services

Property Investment

Relevant Teams

Legal

Real Estate

Finance

Compliance

Risk Management

Property Management

Commercial

Investment

Operations

Administration

Relevant Roles

Real Estate Manager

Property Lawyer

Financial Director

Legal Counsel

Property Developer

Investment Manager

Compliance Officer

Real Estate Agent

Commercial Director

Property Portfolio Manager

Contract Administrator

Risk Manager

Finance Manager

Legal Administrator

Real Estate Investment Advisor

Industries
Teams

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