In real estate transactions, the role of down payments and earnest money is crucial: down payments increase the stability of the contract, and earnest money prevents the contract from being canceled. After the transaction is completed, the title is finalized through the registration process, which clarifies the relationship of rights and ensures a stable transaction.
The right to have control over an object is called a property right, and includes the right of occupancy, ownership, charter, and mortgage. Real estate is generally more expensive than movable property, so transactions involving real estate are more cautious and cumbersome. For example, when buying or selling an apartment, the buyer usually pays a down payment of about 10% of the purchase price to the seller. In practice, the down payment also serves as a penalty, so the buyer can waive it and the seller can unilaterally cancel the contract by asking for double the amount.
This is an important element of trust between the seller and the buyer. From the moment the money is exchanged, the parties feel responsible for the fulfillment of the contract, and it serves as a deterrent to breaking it. Furthermore, the down payment provides legal security for both parties, as it serves as a clear proof that the sale contract has been finalized.
You can also pay an additional portion of the remaining 90%, which is known as the earnest money. Once paid, the contract cannot be canceled unilaterally. The purchase price is then finalized by paying the remaining balance of the purchase price, and the buyer receives the deed and other documents from the seller. At this point, the contract of sale is considered complete, and it remains to be registered.
Information on real estate rights is entered into a register in accordance with the law, and the process of entering it into the register at the request of a party or the entry itself is called registration. The organization of the register is centered on the property, not the owner, and there is only one register for one property. In principle, there cannot be separate ownership of parts or components of an object, nor can there be a single title covering several objects.
In the case of an apartment, for example, there is only one register for the apartment, and the title page contains information such as the address of the apartment and the condition of the building, and the cover page contains information about the creation or change of ownership of the apartment. If there are any non-ownership rights, such as leases or mortgages, they will be listed in the subdivision. This clarifies the rights of the property and increases the stability of the transaction.
Real estate transactions don’t just end with the signing of a contract; what happens afterward is just as important. After the buyer pays the deposit, you need to check the land registry and get all the documents from the seller. It’s also wise to enlist the help of a lawyer or solicitor to avoid any legal issues that may arise during this process. Once the registration process is complete, the buyer will be recognized as the official owner and will have a strong position in any legal disputes that may arise.
It’s important to make sure that the deed reflects the true ownership, as it’s the disclosures in the deed that are relied upon to stabilize the transaction. A new cause of registration, such as a change of ownership through a sale or purchase, is called an entry registration, such as a transfer of ownership registration or a mortgage registration. In addition, if it is confirmed that the completed registration is inconsistent with the actual legal relationship due to an error in the application, you can apply for a registration to correct it. This is called a corrective registration. Corrective registrations can be registrations that correct the real estate or the mark of the registered person, or they can be registrations that correct the right itself, such as a mortgage registration being corrected by a charter registration.
As a general rule, the application for registration must be made jointly by the right holder and the recorder to ensure the authenticity of the registration. The right holder refers to the person who will be added to the register as a new right holder, and the recorder refers to the person who was originally recorded as the right holder. Registration under an apartment purchase and sale contract must also be applied for jointly by the buyer and seller. Many people think that the buyer applies for registration, but this is only because it is common for the buyer to authorize the seller to apply for registration.
There are two principles that determine the effectiveness of the registration The principle that a change of title is not effective as between the parties, as well as in relation to third parties, if it is not disclosed is known as res judicata. On the other hand, the principle that a change in water rights is valid between the parties once the contract is finalized, but the effect of the change in water rights cannot be claimed against third parties if the disclosure is not made is called counter-requirementism. The Korean legal system is based on the principle that the owner of the property acquires ownership when the name is entered in the register.
Therefore, it is important to follow the registration process thoroughly, and to check the register from time to time to ensure that your rights are protected. Real estate transactions are big life decisions and require careful and thorough preparation. This will help you avoid unexpected legal disputes and ensure a safe and satisfying transaction.
