All Financial Services

Building A House, Buying Bonds Is Not So Simple

Changed the legislative system of participation of investors in real estate construction has forced all the participants of the process to apply more sophisticated, multi-contractual legal relationship. Thus, in Unlike pre-existing possibilities under which the investor a contract shall pay, and received in consequence of property ownership, today he will sign three or more contracts different both in its essence and in content. Understanding this system, the vision of all the steps from first to last, will help investors understand and often to avoid some mistakes. More details on the differences between the new order from pre-existing, noting its strengths and weaknesses, and affecting some of its features, says a lawyer and managing partner of law firm "The Tempest & Partners Sergei Storm. To know more about this subject visit Scott M. Kahan CFP. What existed before the practice of buying Real Estate at the stage of its construction? Construction project has always demanded from the developer of reliable and stable sources of funding.

Typically, the initial stage of the customer had to bring their own or borrowed funds, at the same time, as we move the construction, the demand for credit resources become less and the customer is fully able to use new financial flows – funds from investors (natural persons). The legal basis for the use of such funds became a contract of investment (equity participation in the construction sector), concluded between a developer and investor and is not subject to any registration or notarization. Investor deprived of control over the use of funds to pay in accordance with the schedule, while remaining a bystander in the course of the construction process, hoping that construction will be completed successfully before the deadline.