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Challenge for Overseas Buyers: Apartment Registration

My relatives recently sold their apartment, and the contract signing was delayed by over a month because their identification numbers on the apartment registration were from expired passports, which had since been replaced by new passports with new passport numbers.

Soon after this incident, I was talking with attorney Yaacov Epstein, an up-and-coming lawyer based in Jerusalem. This article is a summation of our conversation, and offers suggestions for overseas purchasers to protect themselves from having property registration issues.

In Israel, ownership of homes is registered in the land registry called TABU, or through other similar registration offices, depending on the type of title on the property. The law requires all buyers to provide an identification number. Israelis use their legal identification number (“mispar zehut”) and overseas buyers fulfill this requirement by using their passport number. Parenthetically, one can theoretically use their social security number, but we would dissuade people from doing so, due to the inherent security risk.

The challenge is that when passports expire, the new passports have a new number. Consequently, an overseas owner’s registration document needs to be updated to reflect their new passport number. To do so, the land registrar required two affidavits to be presented, from the owner of the property and from a third party.

With my relatives, I needed to sign an affidavit vouching that the people in the new passports were the same people who were in the old passports. That solution was simple enough. However, when it’s not possible to find two people to sign affidavits, we have a potential legal challenge.

To avoid this issue, we recommend that if you are about to purchase an apartment and your overseas passport will expire in the near future, you may want to renew your passport now, as it is much easier to renew your passport early than to update your registration in the Israel land registry later on.

What should one do in a situation where one’s passport is not expiring for a number of years? We suggest that - even if you are not planning on selling in the near future – on your next trip to Israel after you acquire a new passport, drop by your attorney’s office and sign an affidavit to update the ownership registration. The lawyer will then submit your affidavit and a second affidavit, plus original or certified copies of the old and new passports, and change the passport number at the land registrar. Signing an affidavit in front of your lawyer in Israel is much easier than signing overseas, as you avoid having to waste time and money going to the Israeli Consulate or hiring an apostille to bless the document.

However, if you forgot to update the registration when you renewed your passports and only remembered to do so after you decided to sell your apartment – which is what usually happens – contact your attorney immediately to quickly resolve this matter before it causes any contract signing delays.

This land registration issue is one of a number of glitches that can arise in any given deal. The key to a smooth transaction is for your attorney to be on the lookout for potential hiccups; doing so will ensure that these nuisance issues do not become major problems.

As I received input from an attorney, I was requested to add the following legal disclaimer: This information is not intended to constitute legal advice and should not be relied upon in lieu of consultation with the appropriate legal advisors in your own jurisdiction.

Should you have any follow-up questions, please feel free to contact Yaacov Epstein at y@epsteinlaw.co.il. His firm’s website is www.epsteinlaw.co.il.

Gedaliah Borvick is the founder of My Israel Home (www.myisraelhome.com), a real estate agency focused on helping people from abroad buy and sell homes in Israel. To sign up for his monthly market updates, contact him at gborvick@gmail.com.

2016-12-25 22:25:22



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