Moroccan Real Estate Law

Preliminary sales agreement without a notary in Morocco: Pitfalls, risks of losing funds, and hindrance to repatriation.

July 26, 2025

Real estate investment in Morocco attracts many investors, whether they are foreigners or Moroccans Residing Abroad (MREs). The appeal of a city, promising opportunities, or even just the presentation of models can lead to a certain haste, pushing some to quickly seize opportunities. Faced with this desire to acquire a property, the temptation is great to conclude preliminary agreements, such as "preliminary sales agreements without a notary," or to to pay advance funds directly to the seller, sometimes up to 60% of the price, or even the entire amount, in cash or by other means.

However, as Ms. Amal Anouide points out, lawyer at the Safi barthis practice is "Dangerous" and "strongly discouraged"It exposes buyers to considerable risks:absence of legal guarantees Regarding ownership of the property or any potential land encumbrances, a High risk of losing funds (the seller could, for example, resell the property to another party), and major obstacles to the subsequent repatriation of capital and capital gains in the event of resale of the investment. This article aims to detail the pitfalls of this process and to highlight why the notary is the An essential professional to consult from the first contact until the liquidation of your investment, in order to guarantee the security of your transaction and the traceability of your funds.

I. The unsuspected dangers of "preliminary sales agreements without a notary" and direct advances

One of the most critical mistakes made by buyers is to commit financially without the guidance of a legal professional.

1. Dangerous and unsecured cash advances

Master Amal Anouide is formal: he is "It is strongly advised against making any payment to the seller, whether cash or otherwise, nothing at all."However, reality shows that buyers, attracted by a project or a city, pay deposits that can reach "up to 60% of the selling price, sometimes even more; some even pay the full selling price" directly to the seller. Such a practice is described as "dangerous".

This method exposes the buyer to a total lack of immediate guarantees and creates major legal uncertainty:

Uncertainty about the quality and ability of the seller Without the involvement of a notary, the buyer has no certainty that the seller is indeed the legal owner of the property and that he has the legal capacity to sell it.
Risk of unidentified land charges The property may be encumbered by property charges (mortgages, debts, or tax arrears) unknown to the buyer. The notary, however, carries out essential preliminary checks to ensure that the property is "free from any charge".
No immediate transfer of ownership The buyer is not owner only on the day the deed is registered in the land registerUntil this transfer is completed, the funds paid directly to the seller are not secure and "must remain with the notary"because it is the "Buyer's guarantee"Indeed, the notary only releases the sale price held in escrow for the benefit of the seller after the registration of the land deed.

Although direct payment of money to the seller is not "prohibited" by exchange control regulations, "From a practical, notarial and legal standpoint, it is strongly advised against paying for the signing of the notarial deed in advance." due to the multiple risks involved.

2. Real risks of loss of funds and litigation

The consequences of these practices are often dramatic and can lead to complex disputes and significant financial losses:

Loss of funds and resale to a third party There are situations where a seller, after receiving a substantial advance payment, transfers the property to another party. The original buyer then finds themselves without the property and facing enormous difficulties in recovering the funds paid.
Eviction request by the new owner : A buyer who has paid a deposit may face an eviction request from a new, legally registered owner, even if they have already paid a significant sum for the property.
Difficulty in proving the agreement or recovering the funds The absence of official documents drawn up by a notary makes proving the agreement difficult in the event of a dispute. One case was cited where a buyer who had paid a deposit of 20,000 dirhams (2 million old francs) to a "simsar" (real estate broker) found himself without solid proof, and the broker even refused to testify on his behalf.

II. The indispensable role of the notary: Legal security and traceability of funds

In light of the pitfalls we have just discussed, the central and absolutely non-negotiable role of the notary is highlighted. As confirmed by Maître Amal Anouide, for any investor, whether foreign or Moroccan Residing Abroad (MRE), the notary is the "The first professional who has to see a country is the last."This statement is not insignificant: he is the guarantor of the security of your investment, from beginning to end.

1. The notary: Your legal shield from the first contact

Arriving in a country where you don't necessarily understand all the legal and tax intricacies can be confusing. That's why consulting a notary or lawyer is "Highly recommended" before even taking the first step or making a commitment.

The notary's main role is to"authenticate the parties' contracts"Unlike a simple private agreement (between parties without a professional), a notarized deed confers a "greater guarantee" and one "contractual security"He ensures that the contractors have received all the "Necessary explanations"including on the« impact fiscal »before signing.

But the notary's role is not limited to simply drafting documents. It is a comprehensive and indispensable support :

Legal and tax advice: The notary provides precise legal and tax advice, enlightening you on the situation of laws, rights and taxes in force.
Essential preliminary checks: Before any signing, the notary carries out crucial stepsHe makes sure that the property is "free from any charge"that is to say, it is not encumbered by mortgages, debts, or tax arrears. He also checks the "Quality of the owner" and its " ability " legal requirements for selling the property. A significant new development is the obligation to obtain a "Tax certificate" prior to signing the deed of saleto confirm that all taxes are up to date.
Securing the transfer of ownership: The buyer is not "owner only on the day the deed is registered in the land register"Until this registration is completed, the funds paid are not secure. The notary is the one who guarantees this process.

2. Traceability of funds: The key to secure repatriation

One of the most compelling reasons to use a notary is the securing funds and the guarantee of their traceabilityessential for the future repatriation of your capital and capital gains.

The notary, guarantor of your funds: The notary is categorical: "The funds must remain with the notary; this is the buyer's guarantee."The notary only releases the sale price to the seller once..."at the time the land deed is registered"Paying advances "directly into the hands of the seller", whether in cash or by other means, is "Strongly discouraged" and exposes you to"Enormous risks".
The importance of traceability for repatriation: Morocco offers the "Retransfer guarantee"allowing you to repatriate the capital and capital gains from your investment. However, this guarantee is conditional upon proof that the initial investment was financed by the "Repatriation of foreign currency"That is why the "Traceability" is crucial.
How to ensure traceability? He is "It's preferable to open a convertible dirham account first." in Morocco, to which you make a transfer from abroad to finance the purchase. This type of account is specifically funded by foreign currency and is the the only legal option for non-residentsAlthough you can make a transfer directly to the notary's account, the main point is to "maintain traceability".
Consequences of the lack of traceability: Without proof of foreign financing, repatriation of funds may be limited. If the acquisition was made with local income and the repatriated funds cannot be traced, the investor may only be able to repatriate a certain amount. "25% each year" the value of the asset, via a convertible dirham account.

3. The "Preliminary Sales Agreement": A step to be overseen by a notary

Although the "preliminary sales agreement" is not "not mandatory" For any real estate acquisition in Morocco, it has become more common, particularly with the new requirement to obtain a tax certificate beforehand. This preliminary document allows the parties to "secure their agreement" while the procedures are being carried out.

A preliminary sales agreement is also often signed in cases of Bank financing or when necessary lever des charges (such as mortgages) on the property, in order to buy oneself the necessary time. In all these scenarios, for it to be a security tool rather than a trap, it is It is strongly recommended that it be drawn up and supervised by a notary..

In short, a notary is much more than just a drafter of documents. He is the advisor, auditor and guarantor of legal and financial security of your real estate transaction, thus ensuring the protection of your capital and the possibility of repatriating your funds with complete peace of mind.

III. The crucial issue of repatriating funds

Morocco offers a valuable opportunity to foreign investors and Moroccans Residing Abroad (MRE): "Retransfer guarantee"This guarantee means that you can repatriate the proceeds from the sale of your property – that is, the invested capital and any capital gains realized – "at any time"However, this ease is not unconditional; it is subject to a fundamental requirement: the "traceability" funds.

1. Traceability: The cornerstone of repatriation

The essential condition for fully benefiting from this retransfer guarantee is to prove that "The investment was initially financed by the repatriation of foreign currency."In other words, you must be able to demonstrate that the funds used for the initial acquisition came from abroad.

How can this traceability be ensured?
- Open a convertible dirham account It is "preferable to first open a convertible dirham account" in Morocco. This type of account is specifically designed to be funded with foreign currency.
- Make a transfer from abroad It is to this convertible account that you will need to make a transfer from abroad to finance your purchase. This creates clear bank proof of the origin of the funds.
- Prefer bank transfers Transfers must be made via bank transfer or SWIFT. Cash payments are not the appropriate method for repatriating currency as a foreigner and do not offer the required traceability.
- Direct proof in a notary's account Although a transfer can be made directly to the notary's account, "the most important thing is to maintain traceability."
- Bank statement You can request a bank statement "at any time in order to be able to repatriate the funds at the time of resale".
- Single account for non-residents For a non-resident in Morocco, the convertible dirham account is the only legal option to hold dirhams.
Why is traceability so critical? If you cannot prove this traceability, for example, if the purchase was made with local income in Morocco without proof of repatriation of funds from abroad, you will not benefit from the full retransfer guarantee. In this case, the possibility of repatriation is limited: you may only be entitled to repatriate a certain amount. "25% each year" of the asset's value, via a "convertible dirham term account". This repatriation would take place at a rate of 25% upon opening the account and 25% on each anniversary for the following three years.

2. Capital gains tax upon resale

The process of repatriating funds is intrinsically linked to the resale of the property, which can generate a capital gain subject to tax.

Capital gains tax Generally, capital gains are subject to a tax of "20% of the profit made"There is also a "minimum contribution of 3%" of the sale price, even in the event of a capital loss (sale at a loss).
Exemptions An exemption is possible after "5 years of principal residence". For Moroccans residing abroad, their property can be considered their principal residence if they have only one principal residence in Morocco, even if they live abroad.
Prior notice from the tax authorities The notary plays a key role here. To avoid a subsequent tax audit by the tax authorities (who have the right to review the sale price), the seller can, through the notary, request a "preliminary assessment" to determine in advance the exact amount of tax payable. This process requires the signing of a preliminary sales agreement, and the tax authorities have 60 days to respond.

In conclusion, the The presence of the notary is essential Not only during the acquisition process to secure the transaction and ensure the traceability of funds, but also during resale. The notary will guide you through the tax and administrative steps, thus ensuring the ongoing protection of your investment and the smooth repatriation of its assets.

It should be noted that a lawyer authorized to appear before the Court of Cassation is permitted to draw up contracts of sale and the purchase of real estate.