Payment in installments (notary fees)

Payment in installments for notary fees refers to the option of paying the notary fees incurred in connection with a real estate purchase or other notarized transaction not in a single lump sum, but in installments over an agreed-upon period. Notary fees are governed by the German Act on Court and Notary Fees (GNotKG) and are set by law; whether and under what conditions a notary accepts payment in installments is at their discretion. For buyers with limited liquidity, payment in installments can provide significant relief, but it involves specific considerations that should be understood.

How are notary fees calculated?

The amount of the notary fees is determined by the transaction value-typically the notarized purchase price for a real estate purchase-and the fee schedules set forth in the GNotKG. For a purchase price of €400,000, notary fees (excluding land registry entry) typically amount to approximately €1,500-2,000, plus out-of-pocket expenses and sales tax. Land registry fees of a comparable amount are added to this. Overall, notary and land registry costs should be calculated at approximately 1.5-2% of the purchase price. These costs are to be borne by the buyer, unless the purchase agreement stipulates otherwise.

Payment in Installments: Requirements and Practice

Notaries are generally not obligated to allow payment in installments; they may demand immediate payment of their fees. In practice, however, many notaries are accommodating if buyers credibly explain their financial hardship and formalize an installment payment agreement in writing. It is important to note that the notarization and land registry entry are independent of the status of fee payments-a notary may not make the notarization contingent upon full advance payment of fees. However, they may withhold the issuance of copies and certified transcripts until their fees are paid. Therefore, anyone who needs the copy for the land registry entry should pay the fees promptly.

Alternatives to Installment Payments and Financing Planning

Instead of paying in installments, the cash flow burden caused by notary fees can be mitigated in other ways: The most common method is to include the ancillary costs (notary, land registry, real estate transfer tax, and, if applicable, real estate agent’s commission) in the overall financing and co-finance them through the bank loan. Alternatively, some banks offer special loans for incidental costs. Those who cover the fees from their own funds should set aside the amount in a separate account to avoid short-term liquidity problems.

Notary Fees for Special Transaction Structures

For certain types of transactions, notary fees can be significantly higher than the standard 1.5 to 2 percent of the purchase price. For example, if multiple notarization appointments are required (e.g., for complex purchase agreements with multiple addenda), if a company is being incorporated or a comprehensive declaration of division is being notarized, or if a new land charge is being established and a purchase agreement is being notarized separately, the fees can add up. Buyers should therefore have their notary prepare a fee estimate in advance-notaries are required to do so upon request under § 19 GNotKG.

It should also be noted that, unlike real estate agent commissions and real estate transfer tax, notary fees are generally non-negotiable; the GNotKG sets the amount bindingly. What may vary are the out-of-pocket expenses (copying, postage, and filing costs) as well as the sales tax, which may be subject to special regulations for foreign buyers.

Practical Tip for Property Owners in Nuremberg and Franconia

When purchasing real estate in Nuremberg and the metropolitan region, purchase prices often range into the high six-figure or seven-figure range, which means correspondingly high notary fees. We recommend that buyers calculate the total incidental costs as early as the offer phase and explicitly include them in their financing plan. As a rough rule of thumb for Nuremberg conditions: For a purchase price of 500,000 euros, the incidental purchase costs (real estate transfer tax 3.5%, notary/land registry approx. 1.5-2%, and, if applicable, real estate agent’s commission 3.57% incl. VAT) should be estimated at a total of 45,000 to 55,000 euros-an amount that must not be overlooked when planning your down payment.

Consult your financial advisor early on to determine whether the incidental costs can be included in the financing-many banks allow this provided you have the appropriate creditworthiness. If you are paying the fees out of pocket and have liquidity needs, clarify the installment payment option directly with the notary during the preliminary consultation-not after the notarization. We are happy to assist you in connecting with notaries in Nuremberg, Fürth, and Erlangen and will guide you through the purchase process until the keys are handed over.

Frequently Asked Questions

Can the notary refuse to register the property in the land registry until his fees are paid?

The notary is obligated to submit the applications required for the land registry entry. However, they may withhold the issuance of the copy of the purchase agreement and the registration authorization until their fees are paid. Without these documents, the land registry office cannot transfer ownership. This effectively creates significant financial pressure to pay.

Are notary fees tax-deductible?

For owner-occupiers, notary fees incurred when purchasing one’s own apartment or house are generally not tax-deductible. For landlords, however, the portion of the notary fees attributable to the creation of the mortgage can be claimed as business expenses against income from renting and leasing. The costs attributable to the purchase agreement itself, on the other hand, increase the acquisition costs and are depreciated through depreciation.

Is there a statutory payment deadline for notary fees?

The GNotKG does not stipulate a fixed payment deadline; it is customary to pay within 14 to 30 days after the fee statement becomes due. If the debtor defaults, the notary may claim late payment interest and, if necessary, enforce payment through the courts. In practice, accommodating notaries will set out a payment plan in writing when installment payments are agreed upon.

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