In what cases the advance payment for the apartment is returned. Is it possible to return the advance payment if the purchase of an apartment has failed? The advance is refunded within three years from the date of the actual termination of the contract

Not all apartment purchase transactions are destined to be completed successfully. But what should a buyer do if he has already made an advance payment? How do I get my money back?

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Did the purchase fail? But what about the advance?

Omniscient statistics say that almost every fifth real estate transaction involves an advance payment, which is transferred by a potential buyer to the seller of an apartment or private house. At the same time, many subsequently complain that when the sale and purchase is disrupted, serious problems arise with the return of the transferred money. The seller's main motive is the buyer's fault that the transaction did not take place. So is there any way to solve this problem and get your funds back? We will look for the answer to this question in this article.

The main reason for the problems with the return of the advance

The presence of an advance payment, which makes up some part of the cost of the purchased housing, is stipulated in a preliminary agreement or a special receipt confirming the receipt of money by the seller. In the overwhelming majority of such papers, there is a clause on the non-return of funds in case of the buyer's refusal from the transaction, as well as other actions that led to its failure. It would seem that everything is very clear. But if you dig deeper, it turns out that all this is contrary to the current legislation.

Making an advance payment, in accordance with the norms established by law, is just a kind of protocol of intent, and not an obligation to buy an apartment at any cost.

The money transferred to the seller is just an attachment to the contract, which must be returned, regardless of the reasons why the transaction did not take place.

Advance or deposit: clarifying the difference between the concepts

What is an advance and a deposit? What is the difference?

One of the serious problems due to which the sellers of apartments or private houses insist on the non-return of the money transferred to them is the confusion in terms of "advance" and "deposit". We have identified the functions of the first - it only demonstrates the buyer's intention to purchase real estate, however, unlike the deposit, it is not a financial security for the transaction. That is why the transfer of the advance payment may not even be fixed by a specially drawn up preliminary agreement. All that is needed is a receipt from the buyer confirming the transfer of this or that amount to the seller. This document will definitely be considered by the court and in the overwhelming majority of cases will become a killer argument that ensures a win.

If you go back to the requirements of the legislation, you can find the following norms:

• the deposit is returned only if the seller is to blame for the failure of the transaction. If the buyer refuses to purchase real estate, the funds remain with the opposing party (Article 381 of the Civil Code);
• the advance payment is refunded in any case, regardless of whose fault the transaction did not take place. At the same time, it is generally unlawful to include in the preliminary contract of sale any requirements and norms on the liability of one of the parties (Articles 421, 422 and 1102 of the Civil Code.

The presence of a receipt or an agreement is sufficient proof that the money transferred to the seller is exactly an advance. Therefore, the court in any case must make a decision in favor of the failed buyer.

As practice shows, domestic courts do just that. Not only that, they don't even consider any of the sellers' arguments. Therefore, by filing a claim, you can safely count on success even if you do not have receipts or any other documents on hand.

In what situations is the advance still not returned to the buyer?

When is the advance not returned?

Despite all of the above, sometimes there are still situations when the advance payment remains with the seller even after a court decision. And the reason for this is the not too attentive attitude of real estate buyers to the process of drawing up, filling out and signing documents.

Most often, the advance payment is not returned for the simple reason that the additions to the preliminary agreement indicate that if the buyer refuses to complete the transaction, the funds received from him remain with the seller as a penalty for moral and other damage. In this situation, the court will quite rightly take the side of the latter and the decision in his favor.

Be careful when signing documents on the transfer of an advance!

When signing an agreement on the transfer of an advance to the seller, make sure that this document contains the following information:

• the value of the property you intend to buy. This item will not have any effect on the return of the advance payment, but it will insure you against a sudden price increase on the initiative of the seller;
• the amount you transfer as an advance;
• detailed description of the property;
• the time frame in which the transaction must be completed.

To minimize all possible risks associated with a preliminary agreement, it must be signed by both parties without fail. In addition, it is better to entrust the drafting of the document to an experienced lawyer who must be present at the procedure for signing the agreement. This is the only way you can count on the consideration of the case on the return of the advance payment in court, as well as on its successful outcome for you.

Advance payment or prepayment is a term used in legal documents and denoting an advance payment, any part or all of the settlements under the concluded sales contract. Prepayment is applied when the agreement contains the obligation of the buyer to pay in full or in part for the goods before the seller transfers it within the time period specified by the prescribed conditions or by article 314 of the Civil Code of the Russian Federation.

It is provided for a wide range of services and goods, it is introduced as a guarantee of the execution of the agreement between the buyer and the seller. Many people wonder if the prepayment is refunded or not. Let's figure it out in this article.

Cases are different

Sometimes situations arise when you need to abandon the transaction and return the prepayment. There can be many reasons for this development of events. So, for example, after paying a deposit to buy a car, the buyer urgently needed money. Or an advance payment was made for the repair, but it turned out that it was of inadequate quality.

How can the prepayment be returned? When is it impossible to do this? To find out the answers to these questions, you need to familiarize yourself with the relevant regulations, which are spelled out in the Civil Code and the Law "On Protection of Consumer Rights". So, is the prepayment refundable or not?

Types of prepayment and its specifics

The Civil Code of the Russian Federation regulates the legal norms of relationships related to the terms of prepayment. Here the general rules are laid down to ensure the correct order of this procedure.

Since sales and purchase agreements include various forms of payment with all sorts of conditions of legal relations, it is possible to divide the prepayment into the following types:

• full: the client pays the entire cost of the contract;
• partial (advance): incomplete payment for the goods in the established amount or percentage of the amount;
• revolving - the constant conclusion of a deal with a prepayment over time.

Is prepayment refundable for services? More on this later.

Differences between an advance and a deposit

Many people confuse an advance and a deposit, thinking that they are one and the same. However, in reality, these concepts have significant differences. Often, the agreement establishes one of these types of prepayment, citizens do not know what the difference is between them, although it is very important when returning funds.

A down payment is a strict type of prepayment that is regulated by law. It performs the following functions:

• acts as evidence of an agreement;
• serves as a guarantor of the fulfillment of the obligations assumed by the parties.

The law established a procedure regulating the return of the deposit. If the client refuses any service for which a deposit has already been paid, then it will not be returned. However, in the event that the supplier became the culprit for the failure to perform the service, he must pay a double deposit. Is the prepayment returned or not? A lawyer will help you figure it out.

An advance is a simple prepayment, most often used for upfront vendor spending. It is returned in the usual way: if the service was not provided, the client has the right to demand back his advance. It is not regulated at the legislative level. Payment must be in writing, at least in the form of a receipt. If it is the deposit that is negotiated, then it is recommended to conclude an additional agreement.

How to get a prepayment refund for an item?

If the goods are purchased with a mandatory advance payment, you need to draw up a sales contract in writing, where the full name of the goods will be indicated, the delivery time is agreed, the prepayment amount or percentage of the total cost and the calculation procedure are fixed. Is the prepayment refundable?

By making an advance payment, the buyer can return it in the following cases:

• in case of non-compliance with the required quality of the goods;
• in case of violation of the delivery time;
• upon delivery of a product other than the one ordered.

If the buyer did not receive the goods within the specified timeframe through the fault of the seller, then he has the full right to demand the prepayment made earlier, unless an additional agreement has been concluded on setting new terms or postponing them. In this case, you can require the seller to pay a penalty equal to 0.5% of the total amount of the advance payment for each day overdue.

Is the prepayment refunded for services if I cancel them? More on this below.

We make a claim

If a refusal to reimburse the entire amount of the prepayment is received, then it is necessary to draw up a claim or statement to the seller in writing, which will describe such criteria as: the name of the product, the amount of the prepayment, delivery time, the delay time and the requirement for the seller to pay a penalty from that day to which the goods must be transferred under the contract. You need to make a claim in two copies, and one of them is given to the seller or his legal representative for signature. You also need to indicate the date of receipt.

If the goods were not purchased ready-made, but were ordered from its manufacturer, then the buyer has the right to demand 3% of the entire prepayment amount for each delayed day.

If the seller fails to pay the penalty within ten days after the buyer's request, the buyer may demand to pay interest for the use of his funds. If, after the expiry of the statutory period, the amount of the prepayment was not returned to the buyer, then he needs to go to court with this claim in order to judicially sort out the conflict.

In order to correctly draw up a claim or statement of claim, it is recommended that you contact a specialist defending consumer rights. It is also worth noting that the buyer's claims cannot be satisfied if the seller manages to prove that the obligations were violated due to circumstances of an insurmountable nature or through the fault of the former. So, the prepayment is not refundable, we have explained how to write a claim.

How to get a prepayment refund for a service?

Most often, an agreement is concluded for the provision of any services, providing conditions under which you can return the advance payment. If such are present, then the buyer has the right to terminate the contract and demand a refund of his funds. The prepayment is not refundable in the following cases:

• with the proper fulfillment of the obligations specified in the contract;
• when the service is performed on time;
• with good quality of the service provided.

If the terms for the provision of the service are violated, the buyer has the right to demand from the contractor the payment of a penalty in 3% of the amount contributed by him for each delayed day. If the client does not want to terminate the agreement, then he can set a new deadline for the contractor. In what cases is prepayment refunded?

Termination of an agreement

In case of termination of the contract, the buyer must write a corresponding statement and come with it directly to the supplier. If the organization with which the deal was concluded is serious and respects its principles, then, most likely, it will not spoil its opinion about itself and will meet the buyer halfway. The money will be fully refunded even when the supplier did not suffer losses from the client's refusal.

If any expenses were incurred, the amount will be refunded with the exclusion of expenses from it. Most often, such subtleties are established in the contract. In the event that the supplier does not want to give money voluntarily, the buyer needs to draw up a claim according to the standard scheme. If it was sent to the address, then the money for the failed service must be returned within ten days.

In the event that this requirement was ignored, the buyer can expect to pay a forfeit. It must be remembered that the claim is submitted in two copies, one of which remains with the buyer (with the seal and signature of the organization supplying the services on it).

If you have not responded to the claim?

If the seller did not respond to the claim within ten days, or if a refusal was received, the buyer has the right to file a claim with the court. The latter should include damage calculation. This amount may include:

• the entire prepayment amount;
• the amount of the forfeit in case of violation of the terms;
• percentage for using other people's funds;
• compensation for damage caused by violation of terms;
• amount for non-pecuniary damage.

If the court decides that the buyer is right, then, in addition to the payments listed above, he is entitled to a fine of 50% of the total amount of damage, including moral, as well as payment of costs associated with participation in the court.

Security deposit or prepayment - what is not refundable? This is a common question.

Professional assistance in refunding prepayment

It is often quite difficult to obtain a refund of paid funds on your own. That is why it is best to seek qualified help from lawyers who will not only help to recover the entire prepaid amount from the negligent seller, but also other costs incurred by the buyer due to violations of the service provider or goods.

Is the prepayment refundable or not? We have answered this question.

According to statistics from the Legal Center of Attorney Oleg Sukhov, about 15% of real estate sellers enter into advance agreements with home buyers, considering the amounts received as a reliable way to ensure the fulfillment of obligations under a future purchase and sale agreement. Nevertheless, in practice, even if the transaction fell through due to the fault of the apartment buyers, sellers have to not only return advances to counterparties, but also pay interest for the illegal use of funds at the rate of 9.5% per annum.

Upfront Payment Conflict Scenario

As a rule, the conflict situation around advance payments develops according to the same scenario. The parties - the buyer and the seller of the apartment - enter into an agreement on the advance payment towards the purchase of real estate. The seller expects that in the event that the buyer refuses to purchase the home, he will be able to withhold the amount paid in advance as compensation. The agreement on the advance payment states that in the event of a breakdown in the sale and purchase of an apartment through the fault of the buyer, the double amount of the advance becomes the property of the seller. However, this guarantee does not apply. Why?

How to return an advance payment for an apartment

“There are no legal grounds for keeping the advance payment from the real estate seller. An advance payment agreement without concluding the main purchase and sale agreement cannot be the basis for a monetary obligation. The advance is the amount of money paid before the performance of the contract against payments due. Unlike the deposit, the advance does not perform a security function, therefore, regardless of how the obligation is fulfilled, as well as in the event of termination of the preliminary agreements, the party that received the corresponding amount is obliged to return it, ”explains lawyer Oleg Sukhov.

According to the lawyer, if the seller refuses to return the advance payment, the failed buyer has the right to go to court with a claim to invalidate the agreement on the advance payment and recover the disputed amount. Moreover, Art. 395 of the Civil Code of the Russian Federation allows the failed buyer to demand from the party evading the return of funds to pay interest for the unjustified use of other people's funds. The amount of interest is determined by the current discount rate of the bank interest on the day of the fulfillment of the monetary obligation or its corresponding part (which is about 9% per annum). This rule applies unless a different interest rate is established by law or contract.

Arbitrage practice

“When it comes to court, the sellers usually insist on recognizing the advance as a deposit,” says lawyer Oleg Sukhov. - In accordance with Art. 380 of the Civil Code of the Russian Federation, a deposit is an amount of money issued by one of the contracting parties against payments due from it under the contract to the other party as proof of the conclusion of the contract and to ensure its execution. Article 381 of the Civil Code of the Russian Federation establishes that if the party that gave the deposit is responsible for non-performance of the contract, it remains with the other party. However, the courts consider that the inclusion in the advance payment agreement of a clause on the liability of the parties, which is applied to agreements on the deposit, contradicts the provisions of Art. 421 and 422 of the Civil Code of the Russian Federation, and recognize such provisions of the agreement as invalid ”.

When considering such disputes, the courts refer to Part 3 of Art. 487 of the Civil Code of the Russian Federation, according to which in the event that the seller, who received the prepayment amount, does not fulfill the obligation to transfer the goods within the specified time, the buyer has the right to demand the return of the prepayment amount for the goods not transferred by the seller. Since the contract for the sale of an apartment between the parties was not concluded, the obligations provided for in the advance agreement concluded between the parties terminate and the amount of advance paid under the contract must be returned to the plaintiff in accordance with Art. 1102 of the Civil Code of the Russian Federation, regardless of whose fault the purchase and sale agreement was not concluded.

According to lawyers, the arguments of the sellers that they considered the concluded agreements as a preliminary sale-purchase agreement or an agreement for receiving a deposit are usually not taken into account by the courts. Moreover, there are cases when the amount of the advance payment was recovered even in the absence of receipts for receipt of money.
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Information about the "Legal Center of Attorney Oleg Sukhov"

The Legal Center for Attorney Oleg Sukhov was founded in 2006, when a team of specialists who were ready to help in the most difficult legal situations united under the leadership of one of the leading Moscow lawyers - Oleg Sukhov.

The Legal Center of Attorney Oleg Sukhov today is an established brand with a high professional reputation and a wide range of services provided (from legal services and comprehensive legal support to financial consulting).

Lawyers and attorneys who specialize in various areas of law are involved in customer service. In their work to protect the rights of citizens and business representatives, lawyers work closely with various government agencies, as well as with law enforcement agencies, which helps to quickly find the best ways to solve complex problems given by the client.

When making large purchases, for example, when purchasing furniture, or expensive household appliances, the store may require an advance payment. This is a guarantee that the product will be purchased and the shipping costs will not be wasted.

However, situations often arise when an advance payment has been made, all the deadlines have already passed, and the goods have not been delivered to the buyer. What to do in this situation, how to return the prepayment for the goods and how to achieve justice if the store representatives do not meet halfway?

Prepayment, advance and deposit are different concepts.

A store may require prepayment from both a private person and an organization: most often this right is enjoyed by car dealerships, high-end electronics stores, furniture showrooms, etc.

The buyer orders the product from the catalog, and the store must ensure that the purchase is guaranteed to be redeemed. There are three prepayment options for this:

1. Complete. The client pays the entire amount, after which the store's task is to provide the goods in full within the period specified in the contract.
2. Partial. A part of the cost is paid, for example 15-30%, and the buyer pays the rest after receiving the goods.
3. Revolving. This option is more often used in trade relations between organizations that conclude a regular supply agreement.

In the documentation, the terms "advance payment" and "advance payment" may be used, in fact, they practically do not differ. Both the one and the other type of payment is intended to ensure that they are paid before delivery of the goods.

It is not always possible to compensate damage without a court decision. It is necessary to prove that due to the delay of the goods, the buyer suffered losses, and for this a complete set of documents must be collected. If the goods were purchased on credit, a loan agreement with a bank will be required. If the goods were to be used as raw materials for the operation of the enterprise, and the disruption in delivery led to downtime, the costs incurred must be calculated and documented.

The proceedings on commercial claims can take quite a long time, however, the option of reconciliation of the parties is possible. Often, a store, in order to end the conflict as quickly as possible, offers the supply of a similar product of the corresponding value. Sometimes the client is asked to pay a little extra and buy a more expensive item with improved characteristics - this trick is often used by car dealerships, deliberately delaying delivery times.

If it comes down to it, the execution of the decision is carried out through the bailiff service. As a result, the buyer will receive the due amount, and the seller will have to compensate for the costs of the court.

How to get an advance payment for an apartment? A lawyer will tell you how real estate transactions are carried out: