In most Bulgarian property purchases, one document sits between the viewing and the notarial deed: the preliminary contract (предварителен договор). It is usually also where the buyer pays a deposit, the "kaparo". This contract decides what happens if someone backs out, if the bank refuses the loan, or if an encumbrance turns up. Here is what the law says, and what the contract should contain so you never need a court.
"Kaparo" is the everyday word. The law calls it earnest money (задатък, Art. 93 of the Obligations and Contracts Act, OCA). It proves the contract was concluded and secures its performance.
An advance is simply part of the price paid early. It carries no penalty: if the contract is terminated it is refunded, and any damages must be proved separately. So do not write just "deposit" — state expressly whether the sum is earnest money under Art. 93 OCA or an advance payment, and how it is credited against the price at completion. Ambiguous wording is the most common cause of disputes.
The amount is freely agreed; in practice it is often around 10% of the price. Pay it by bank transfer — above the statutory cash-payment threshold this is mandatory, and it gives you proof.
A preliminary contract for property must be in writing (Art. 19(1) OCA), because the final sale requires a notarial deed (Art. 18 OCA). An oral promise to buy property creates no obligation to complete.
It must contain the essential terms of the final contract (Art. 19(2) OCA) — at minimum a precise description of the property and the price. Notarising the signatures is not required but is advisable, as it removes any dispute about whether a signature is genuine.
A preliminary contract does not transfer ownership. Title passes only with the notarial deed.
| Clause | Why it matters |
|---|---|
| Property — address, area, cadastral identifier, appurtenances (cellar, attic, parking space) | Without a precise description, an Art. 19(3) claim can fail |
| Price and payment — deposit, balance, own funds / mortgage, accounts | Clear which payment is due when |
| Deadline for the deed | A firm date, plus what happens on delay |
| Mortgage condition | What happens to the deposit if the bank refuses the loan through no fault of the buyer |
| Encumbrances | Seller confirms no mortgages, attachments or tenants — or how they will be cleared before completion |
| Documents | Who obtains what, and by when (certificates, cadastral sketch, tax valuation) |
| Handover | Date, condition, meter readings |
| Costs | Who pays notary fees, local transfer tax and registration |
| Penalty | For delay or refusal, separate from the deposit |
If nothing is agreed on costs, for a sale of real property they are shared equally (Art. 186 OCA). In practice the buyer more often bears them — but it should be written down. You can get an indicative figure from our notary fee calculator.
If the property is mortgaged, the mechanism for paying off the bank belongs in the preliminary contract — see selling a property with a mortgage still on it. The checks on the property itself are covered in legal checks before buying.
A contractual penalty (неустойка, Art. 92 OCA) secures performance and compensates losses without the need to prove them. It is usually set per day of delay or as a fixed sum for refusal. If it is excessive compared with the actual loss, a court may reduce it; if the loss is larger, the difference can be claimed.
Either party may sue for conclusion of the final contract. The contract is deemed concluded when the court judgment becomes final (Art. 19(3) OCA) — the judgment effectively replaces the notarial deed.
Key points:
The claim is an alternative to the deposit remedy: you either withdraw and keep or claim double the deposit, or you sue for performance.
This is general information, not legal advice for a specific case. Verified October 2026.
If you are about to sign a preliminary contract, as buyer or seller, call us or visit our office. We will go through the draft with you before any deposit changes hands.
