Penalties and Fines in the Contract: Seller’s Risks (727)
When selling an apartment in Israel, it is crucial to understand which penalties and fines may be included in the contract and how they affect the seller.
Mistakes at this stage can cost tens of thousands of shekels and delay the transaction.
What Are Penalties and Fines?
A sales contract may include:
- penalties for delays (e.g., late transfer of the apartment);
- fines for contract cancellation after signing;
- additional penalties for failing to meet conditions (repairs, documents, registration).
These amounts are usually fixed as a percentage of the sale price or a specific sum of money.
Main Risks for the Seller
- Delayed Transfer of the Apartment
If the seller cannot hand over the keys or documents on time, the buyer may impose a penalty. - Buyer’s Withdrawal
If the buyer cancels after signing, the seller risks losing the deposit or part of the funds. - Incorrect Contract Terms
Ambiguous or poorly drafted clauses can increase the seller’s liability. - Hidden Penalties
Some contracts include clauses the seller is unaware of, creating unexpected risks.
How to Minimize Risks
- Carefully review all contract clauses before signing.
- Confirm the exact amount of penalties and conditions.
- Ensure that penalties are reasonable and legal.
- Use the assistance of a lawyer or Unehasim specialists for contract review.
- Keep documentation proving fulfillment of obligations (handover acts, photos, correspondence).
Tips from Unehasim
- Do not sign a contract without fully understanding all penalty clauses.
- Ask for clarifications on any ambiguous points.
- If needed, negotiate a cap on penalties in the contract.
- Plan the apartment handover schedule in advance to avoid late-transfer fines.
Contact Unehasim Specialists
If you are selling an apartment in Haifa, Unehasim can help:
- analyze the contract and identify hidden penalty risks;
- clarify actual fine amounts;
- prepare all documents for a safe transfer;
- accompany the transaction together with a lawyer.
Understanding penalties and fines is key to a safe and transparent sale.
