Termination of Property Purchase Agreements

Bought a plot or an off-plan property and considering termination?

Specialist legal guidance makes it possible to understand the rights involved, the prospects of recovering amounts paid and the effects of terminating the contract, based on the Termination Act and on the particulars of each case.

Assessment of whether termination is viable and of the prospects of recovering amounts paid.
Individual assessment of the particulars of the contract.
Specialist legal guidance: strategic, ethical and tailored.

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When is terminating a property purchase usually considered?

A range of circumstances can lead a buyer to consider terminating the purchase of an off-plan property or plot. Although every contract has its own features and calls for individual analysis, certain situations come up frequently in these cases:

Change in financial circumstances

The instalments are no longer compatible with the household or business budget.

Delay in handing over the property

The development was not delivered within the period set out in the contract.

Instalments in arrears

Keeping up the payments has become unfeasible, calling for an assessment of the options available to limit the damage.

Excessive penalties and withholdings

Concern about abusive penalties, withholdings and other consequences of terminating the contract.

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The Termination Act and the buyer's rights

Termination is the legal instrument that formally ends the contractual relationship between the buyer and the developer. Since Law 13,786/2018, the subject has been governed by specific rules, which makes a technical analysis of the contract essential to identify rights, limits and opportunities in each individual case. The amount refunded varies with the nature of the development and the circumstances prompting the termination, which is why handling it strategically is decisive in preserving the buyer's assets.

Every contract is unique and calls for a technical reading of its specific terms.

Experience and specialist practice in property purchase terminations

Careful assessment of the legal viability and the financial consequences of terminating the contract.
Technical calculation and review of the amounts that may be refunded, based on the contract terms and the applicable legislation.
Strategic work in direct negotiations, aimed at mitigating risk and preserving financial interests.

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Specialist legal practice

Specialist Legal Practice

Natasha Braff Costa

Real Estate Law | OAB/RS 124.860

A 2012 law graduate of PUCRS, Natasha has spent more than 12 years working in real estate law. Her career began in the Rio Grande do Sul judiciary, where she served as trainee, clerk and judicial assistant and, for eight years, as Assistant to an Appeal Court Justice in a civil chamber specialising in property rights, real estate and land registration.

On moving into the private sector, she gained valuable experience as Legal Manager of a real estate tokenisation startup and then practised at two large law firms, also in real estate law.

Over those years she trained at the Ajuris judicial school, where she also served as a lay judge, and took postgraduate specialisations in Contracts and Civil Liability (PUCRS), Real Estate Law (UniRitter) and Digital Security, Governance and Data Management (PUCRS).

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Whether termination is viable calls for an individual assessment

Depending on the type of contract, the way the purchase was made and the developer's conduct, the buyer may be entitled to terminate and recover part, or even all, of the amounts paid. The law provides for different scenarios.

Development With or Without Ring-Fenced Assets

The buyer may terminate the contract, with a refund and withholding limited to the agreed conditions. The statutory withholding is capped at 25% or 50%.

Plots and Land

The penalty may apply on the total value of the contract, and not only on the amount paid, and the refund is usually in instalments, as provided by law.

Delay in completing the development

If the works exceed the statutory grace period, the buyer may terminate without loss and with the possibility of inflation adjustment and the contractual penalty.

Right of Withdrawal

Purchases made away from the company's premises, such as at a sales stand. The buyer may withdraw within up to 7 days, with a full refund of the amounts paid.

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Frequently Asked Questions

Can I withdraw from an off-plan property purchase?

Yes. Brazilian law provides for situations in which the buyer can terminate the contract. The financial consequences and the amounts that can be recovered depend on the contract terms and the particular circumstances of the case.

Am I entitled to a refund of the amounts paid?

The possibility of recovering amounts already paid exists in a range of situations set out in legislation and case law. What can actually be recovered depends on the contract terms, the payments made, the particular circumstances of the case and the stage of the development, which is why a specialist legal review is advisable.

Does a delay in completing the development allow termination?

A delay in delivering the development can have significant legal consequences and, in certain situations, justify terminating the contract. A specialist's analysis of the contract and of the deadlines that actually apply is essential.

I can no longer afford the instalments on the property. What can I do?

A change in financial circumstances is one of the most common reasons for terminating a property purchase. A legal assessment can set out the options available and the likely financial effects of termination.

Can I terminate the contract even with instalments in arrears?

In many cases, yes. Instalments in arrears do not necessarily prevent the buyer's rights from being examined. Each situation has to be assessed individually.

How does the initial case review work?

The initial review consists of an assessment of the contract, the purchase documents and the particular circumstances of the situation by one of our specialist attorneys. From there it is possible to identify the rights involved and the legal options available.

Do I need to come to the office in person?

No. The service can be provided entirely remotely, allowing the documents to be reviewed and the case followed with security, speed and discretion.

If you prefer to meet in person, Doering Darcie Advocacia e Consultoria has offices in Porto Alegre and São Paulo for meetings by prior appointment.