Selling property for parents, grandparents and loved ones

As a child, you worry about mom and dad; as a grandchild, you worry about grandma and grandpa. Retirement savings don’t last forever, and neither do the savings. At some point, the property becomes too big, and at the same time the savings become less and less. At the latest now, a solution must be found for your loved ones!

What to do when you need to sell?

Prevention is better than aftercare: options

Before it is about expressions of grief, it is about good solutions. People grow old and at some point, life has to be organized appropriately. For many, this means selling the house and moving into an age-appropriate condominium. Accordingly, close people have to make decisions. This includes living wills, in case your loved ones are no longer able to make their own decisions at some point. But it is just as much a part of thinking about your own property.

One thing is also Important: First and foremost, do not think about your own inheritance, but about the family!

Let’s take a look at the 3 options for your understanding: Sale of the property, partial sale and real estate annuity! Tip, you will find further links to all three topics, with detailed explanations. What to do when someone gets old? Here are three alternatives!

Options in the sale of real estate:

1. Real estate annuity – selling with lifelong right to live
2. Partial sale – Proportionate, with option for total sale
3. Sale – Complete sale of the property

In addition, for owners: an extra tip on the subject of bequeathing correctly.

Real estate pension: sale with extra “pension” – Option 1

Your first option is the real estate pension. The real estate annuity is especially interesting for people who have already reached a higher age, usually from 70, 75 years. Should you prefer a solution in which your relatives can stay in their own property until the end of their life (!) without any complications, then the life annuity is an option you should consider.

Life annuity means that the property is sold in its entirety, but the owner retains a full right of residence and use until death. These privileges are secured by the usufructuary right. In addition, the seller receives a small, monthly extra “pension”. Another advantage, they no longer have to worry about maintenance costs in the future. This is the responsibility of the new owner. All in all, a comfortable solution, especially in old age.

Real estate pension simply explained:

• Direct, complete sale
• Lifetime right of residence and use
• Small, monthly “extra pension” for former owner
• No maintenance costs

Read more about topic here:

• Real estate pension

Unconcerned and reassured into old age.

Partial sale: Proportionate, with possibility of total sale – option 2

The second option for your loved one, if you want them to be able to continue living in their property, whether it’s a condo or a house, is to partially sell a property.

A partial sale works like this, you sell the part of a property, usually between 10% and 50% pro rata, to a finance company. For this sold part, the financial company charges a so-called “usage fee”. The user fee is paid in return for the fact that sole residential rights and rights of use are still granted. This means that the finance company merely becomes the partial owner. The advantage: you get the sale price relatively uncomplicated, without a major credit check, as with loans from the bank. The disadvantage: the user fee is relatively high, e.g. compared to a mortgage loan.

Partial sale summarized:

• You sell a part of your property (usually 10-50%)
• Partial purchase house: Yes
• Partial purchase apartment: Yes
• Partial purchase of land: Yes
• Financial company becomes part owner
• You remain the sole user of the property
• You pay monthly usage fee
• Total sales in X years (optional)

Read more about the advantages and disadvantages here:

• Partial sale property

Complete real estate sale – option 3

Your third option, if you need to find a solution, is the complete sale of condominium, house, apartment building. For the regular process, the question often arises, sell privately or sell with broker? Especially the emotional situations, such as deciding on the future of their own parents or grandparents, it is recommended to work with an experienced broker. After all, it is about all the advertisements, communication with interested parties, selection according to serious, unseriös, the subsequent credit checks, arrangement of viewing appointments and many more. Of course, also a big factor, the previous real estate valuation.

Read more here:

• Sell property

Selling real estate: Procedure and steps

To give you an initial overview of how such a sales process works, explained here in 18 simple steps, categorized into 3 phases.

1. Preparation: prepare property and sale
1. Financial planning and timing of sale
2. Hire real estate agent
3. Records and documents
4. Increase real estate value
5. Determine offer price
6. Create exposé
2. Sales phase: market property and find buyers
1. Market real estate
2. Contact with prospective buyers
3. Filter and select prospective buyers
4. Credit check
5. Viewing dates
6. Sales talk & purchase price negotiation
3. Sales processing: purchase contract until handover
1. Draw up purchase contract with notary
2. Notary appointment
3. Land register entry and payment processing
4. Handover of the property
5. Notary fees & broker commission
6. Pay taxes

These 3 options are primarily available to you.

These were the most important tips for selling with and for your loved ones!

Whether a condominium in a prime A-location or a…

… Condominium in 60/70 prefabricated building:

Extra tip: Bequeath / inherit correctly

Here are a few extra tips for you.

Sale with usufruct

If you are considering a direct, outright sale of your parent’s, grandparent’s or loved one’s property, be sure to take a look at usufructuary rights. Usufructuary right simply means “lifetime, sole right of occupancy.” So, it means that your loved ones hold the sole right to use the property, even after the sale. The same applies in other cases, such as an anticipated inheritance (link above: Inheritance).

Advantage: The usufruct right brings you the advantage that your relatives are not dependent at any time, on the goodwill or the consent of the seller.

Inheritance in advance: Taxes & Co.

Tip. Before it is too late, talk to your parents and grandparents about the inheritance early on. After all, an early inheritance can save you quite a bit, especially on taxes. Learn more about early inheritance here:

• Bequeath correctly

For heirs:

• Inherit correctly

Inheriting correctly also often means preventing disputes among children.

Take care!

No-person GmbH: The GmbH without shareholders

The Kein-Personen-GmbH – or Kein-Mann-GmbH or Keinmann-GmbH – is a curiosity among German forms of corporate law, because it represents a GmbH that has no shareholders. In the Austrian version of the GmbHG, the acquisition as well as the pledge of own shares by the company is expressly prohibited in section 81 and declared ineffective. In Germany, on the other hand, there is no such restriction, which is why a GmbH there is granted the right, as a legal entity, to acquire its own shares without restriction. Thus, the acquisition of 100 percent of the business shares is also possible.

Causes for a no-man GmbH: inheritance, donation, termination & Co.

But how can there be a GmbH without shareholders? There may be different reasons for all GmbH shares to be owned by the GmbH itself: The GmbH can be registered as heir to the business shares and thus actually be left without a single shareholder in the event of inheritance – in the case of a one-person company or two-person GmbH, such a scenario is easy to imagine. Alternatively, the GmbH can also be given business shares by its shareholders or no shareholders remain in the GmbH on the basis of a caducation – i.e. the forced exclusion of shareholders who are not willing or able to pay and who have defaulted on their capital contribution in accordance with the articles of association.

Further reasons are, for example, the sale of shares to the GmbH; the abandonment – i.e. the relinquishment – of shares by the shareholder(s) in favour of a consideration, usually the release or discharge from existing (payment) obligations; or also the withdrawal of shareholders through ordinary termination.

Possible causes of the emergence of a no-person limited liability company:

• Heritage
• Gift
• Caducation
• Purchase/sale of shares
• Abandon
• Cancellation

Establish a GmbH: Legal form and alternatives

1. One-person GmbH: Solo founder
2. Two-person GmbH: Founder Duo
3. Limited liability company (GmbH)
4. Special case: Real estate GmbH
5. Legal forms: List

One-person GmbH: Solo founder

One-person GmbH – The GmbH model for solo founders! By appointing new shareholders or leaving existing shareholders, the GmbH model you choose can easily change. Whether it’s a one-person company, a two-person limited company or even a company that operates without any shareholders at all…. In each case, there are special features that you should be aware of, as they deviate from the norm of the conventional limited liability company.

• One-person limited liability company

Two-person GmbH: Founder Duo

Two-person GmbH – The GmbH model for founding duos! By appointing new shareholders or leaving existing shareholders, the GmbH model you choose can easily change. Whether it is a one-person company, a two-person GmbH or even a company that operates without any shareholders at all… In each case, there are specifics you should be aware of as they deviate from the norm of the traditional limited liability company.

• Two-person limited liability company

Limited liability company (GmbH)

Limited Liability Company (Gesellschaft mit beschränkter Haftung, GmbH) – The limited liability company is a German legal form that is founded by at least one person and managed by at least one shareholder. As the name already indicates, this corporate legal form is characterized by a limitation of liability for its shareholder(s).

• Limited liability company (GmbH)

Special case: Real estate GmbH

Immobilien GmbH / Vermögensverwaltende GmbH / Immobiliengesellschaft – In this article you will learn the basics about real estate companies. Who would think of founding a limited liability company when buying a house or a condominium? Admittedly, this makes no sense for owner-occupation, but it does for renting.

• Real estate company

Here you will find all the legal forms that can be chosen as a founder in Germany and a guide with a checklist:

Legal forms: List

Legal forms – What types of company are there? If you want to start your first company, then choosing the ideal legal form is one of the first steps in the process of setting up a company. Whether it’s a special real estate company or a start-up, I’ve summarized all the types of companies in Germany for you here.

• Legal forms: List

Divorce and pension – the facts about pension equalisation

There are many things to settle in a divorce. From custody to the division of assets to the pension equalization. The latter deals mainly with the pension that was acquired during the marriage and how this is divided fairly between the spouses.

The most important facts in a nutshell:

• In most cases, spouses acquire different levels of pension entitlements during the marriage period
• The aim of pension equalisation: to ensure that both spouses are equally well provided for in old age
• Only the entitlements acquired during the marriage period are taken into account in the pension rights adjustment.
• The period of marriage determines the amount of pension equalisation
• The longer the marriage, the higher the pension equalization
• Pension equalisation is automatically settled at the time of divorce for marriages that have lasted longer than three years. Marriages that have lasted less than three years must apply for pension equalisation.
• The spouses fill in a form giving details of the acquired pension rights.
• The court checks the figures with the pension providers after
• Waiving the pension equalization can be useful for both spouses in some cases

The principle – dividing pension entitlements

The pension entitlements are different for most married couples. This fact is due to the fact that one of the spouses has not worked for a certain period of time due to raising children, has been unemployed or has been employed in the public sector. To compensate for this difference, there is pension equalization, which is intended to ensure that both spouses have good retirement security. However, only the pension that was earned during the marriage period is taken into account. The pension earned is divided up in the divorce in such a way that both spouses leave the marriage with the same amount.

• In most cases, spouses acquire different levels of pension entitlements during the marriage period
• The pension rights adjustment provides for equally good pension security

The marriage period – relevant for the amount of the pension rights adjustment

Since only the pension entitlements that were acquired during the marriage are included in the pension rights adjustment, the marriage period is decisive for the amount of the adjustment. The marriage period runs from the beginning of the month in which the marriage was entered into until the end of the month preceding the service of the divorce petition. If the period of marriage is less than three years, no pension equalisation has to be carried out in the divorce unless one of the spouses insists on it.

Pension entitlements acquired during the separation period are also included in the pension rights adjustment. However, if the separation period is unusually long, it may be justified under certain circumstances to calculate the pension equalisation only for the period from the marriage until the separation. No pension equalization can be approved by the court only in divorces involving special misconduct. This case is when one spouse has massively threatened or injured the other.

• The period of marriage determines the amount of pension equalisation
• The longer the marriage, the higher the pension equalization
• Only the entitlements acquired during the marriage period are taken into account in the pension rights adjustment.

The practice – step by step to pension equalisation

The equalisation of pensions is automatically regulated in divorces where the marriage has lasted more than three years. The spouses receive a questionnaire in advance in which they must provide information on existing insurance policies and entitlements, state insurance numbers and disclose agreements on pension equalisation. These questionnaires are then returned to the court so that it can have the information checked with the pension provider. The various pension providers are required to provide the family court with their respective pension entitlements. The figures are then sent back to the spouses by the court so that they can check the figures and comment on the information if necessary. The pension equalisation is then determined at the divorce hearing in court.

• The pension equalisation is automatically settled at the time of divorce for marriages that have lasted longer than three years.
• The spouses fill in a form giving details of the acquired pension rights.
• The court checks the figures with the pension providers after

Pension rights adjustment – division of pensions in the event of divorce

Waiving the pension rights adjustment – useful in some cases

Depending on the individual situation, it may make sense not to have the pension equalisation settled by the court. If, for example, the costs of division are too high or if the settlement would lead to an unfair result, it is possible for the spouses to settle the settlement between themselves. If both partners agree to this, a settlement amount can be paid instead of the transfer of the entitlements or a consideration can be agreed. In the case of marriages with a marriage contract, the issue is usually settled from the outset, as the equalisation of pensions is stipulated in such contracts from the outset.

• The waiver can make sense for both spouses in some cases
• Marriages that lasted less than three years must apply for pension equalisation at the time of divorce.

The most important questions – everything about pension rights adjustment

The topic of divorce and especially pension equalization often raises many questions. Lukinski’s experts answer the most important questions on the topic of pension equalization in divorce so that you know exactly what is going on and no more questions remain unanswered.

What does pension equalisation mean in the event of divorce?

This is nothing other than the equalisation of pensions. This regulates how pension entitlements acquired during the marriage are dealt with after the marriage. The aim of pension equalisation is to ensure secure old-age provision for both spouses.

How much does a no-fault divorce cost?

The cost of a divorce depends on a number of factors. Some divorces are generally cheaper than contested ones, simply because they take less time. However, other factors include the assets of the spouses, which means that individual costs must be decided on a case-by-case basis.

What do you need for the divorce?

Whether the divorce is unanimous or contested, some documents are always needed. These documents include the marriage certificate or the family record book in the original or a certified copy, depending on the case, the birth certificates of minor children and, if available, the marriage contract or the divorce settlement agreement.

What does a divorce cost and who pays?

The amount of costs varies from divorce to divorce. The costs are generally set off against each other. So each party pays their own legal fees and half of the court costs. The exact amount of the legal costs is decided by the court and depends on various factors.

Divorce: guide, help and tips

Divorce is complex, it’s true. But you are not alone! Many let themselves separate and in fact, a large part always finds a good solution. Only a small part ends in a quarrel. So that you can prepare well, you will find here our small guides and tips on divorce, family, money and real estate.

• Divorce: Guide