36 ms·

To be honest, I don't think much of notaries and believe that they stifle innovation and harm the German economy, especially SMEs, but also clubs and citizens.

To be honest, I don't think much of notaries and believe that they stifle innovation and harm the German economy, especially SMEs, but also clubs and citizens. For example, the purchase or sale of a property can only be carried out with a notary who reads the purchase contract for both parties. For this service, he charges a fee of around 1.5% of the sale price. The entire profession is strictly protected by law and there is no competition.

morkalork 3y ago
Wow and I thought realtors getting a % cut on sales was a scam, at least in NA when you get to the notary, it's a flat fee.
- namaria 3y ago
  In Brazil notaries get a cut of real estate deed transfers, and the position was hereditary until the 1990s.
  - ProjectArcturis 3y ago
    In Italy, getting something notarized costs $1-2k. As far as I know, the position is still passed down from parents to children.
    - morkalork 3y ago
      Are there other officially hereditary jobs still out there?
      - piaste 3y ago
        It's not technically hereditary. But if the job licenses are a finite resource, and the licensee "owns" the license and is allowed to give/sell it to a person of their choice, and the job is reasonably pleasant/profitable... they're very likely to pass it on to their children, unless those children have other plans. Pharmacies in Italy work much like notaries, although they obviously provide a much more useful service. My understanding is that in part of the US taxis work the same way, with limited # of "medallions" being treated as an investment.
      - geraldhh 3y ago
        farmers
- somat 3y ago
  It sounds like notaries are a different service as well, in the US a notary is a minor(very minor) government official whose primary purpose is to verify that the person signing a document is the person they are claiming to be. For the most part US notaries have little knowledge of the contents of that document. In California (I think other states, but each state has it's own specific laws) the fees are fixed below a small set amount. https://www.nationalnotary.org/knowledge-center/about-notaries/notary-fees-by-state https://www.nationalnotary.org/knowledge-center/about-notari...
  - morkalork 3y ago
    At least in Canada, it's not government employees but rather not-quite-a-lawyer types who are glorified ID verifiers.
    - somat 3y ago
      I was a but optimistic on my wording, But in the US they are not government employees(they are not paid any sort of salary) just citizens who are authorized to verify signatures(a governmental duty, which is why I called them minor government officials) and are are allowed to collect a small fixed fee for their effort.
      - deleted 3y ago
        [deleted]
      - hnbad 3y ago
        FWIW in Germany in order to apply as a notary you have to be a lawyer and the number of notaries is very limited and they're lifetime positions. As with all public officials, there are severe penalties for professional misconduct and losing your lifetime position and benefits is usually enough of an incentive to keep these people honest and careful.
pintxo 3y ago
Technically, there is competition. You are free to choose whichever notary you want. But pricing is legally regulated, so you will pay the same price everywhere.
- almostnormal 3y ago
  The solution is easy: Create a small company to own the property. That company can be sold much more easily than the property itself. It also avoids the tax on propery purchase.
  - robocat 3y ago
    Companies have other issues like VAT/GST and reporting. I had a friend use a company in New Zealand and it cost him multiple % of property price due to an issue he didn't forsee. New Zealand doesn't have notiaries or special insurance but you do need to use a lawyer to transfer ownership and I think it costs about NZD1500 each for vendor and buyer.
    - pintxo 3y ago
      Yes, for Germany you can expect at least around 5k/a in costs for accounting, audits etc.
  - pintxo 3y ago
    The property tax thing is actually not true. Not if the company only exists to hold properties. The tax office is not that stupid.
- rjzzleep 3y ago
  The amount of notaries in Germany is very limited. . You can’t just study that and open a notary in Germany. They are cash cows that obviously don’t want competition. During Covid Germany was the only country of its neighbors that did not do remote attestations. From 2000 to 2020 the number of notaries in Germany had almost halved. How is that normal for any country ? Unless they replaced notaries with automation which Germany didn’t .
mensetmanusman 3y ago
Every word they say is worth about €50 then!
alphager 3y ago
The Notar does much more than just read the contract; he is liable for the correct administration of the transfer of ownership (done by a three phase process which guarantees that the seller cannot get the money without transferring the property and the buyer cannot get the property without selling the money). The concept of title insurance doesn't exist in Germany as the Notar eliminates the risk.
- nickff 3y ago
  From a brief search, title insurance often costs around 0.1% of the purchase price of a property; it seems the Notars are collecting a monopoly rent in Germany.
  - StefanWestfal 3y ago
    Common in practice is 0.5%
  - rad_gruchalski 3y ago
    They still have to read the deed!
- twixfel 3y ago
  OK but how is it that other countries get by without them for founding LLCs? Are there countless scams going on in the UK surrounding limited company for example since you don't need a notary there? There's often lots of post hoc justifications in Germany for "why it is that way" (and has to be that way). But nobody ever seems to stop and think: ok but the rest of the world seems to get by OK without these reams and reams of bullshit? The problem with Germany is not that it is stuck in the 20th century and completely backwards, but that nobody seems to care that it is. Worse, if anything there seems to be a degree of pride among Germans of the "process". As soon as you criticise some piece of particular bullshit German bureaucracy (as opposed to bureaucracy in general, which generally you're permitted to criticise) then they start circling the wagons (often pointing to other countries where the situation is supposedly the same or worse). So it is never going to change.
hot_gril 3y ago
This sounds like an escrow.

morkalork 3y ago

Wow and I thought realtors getting a % cut on sales was a scam, at least in NA when you get to the notary, it's a flat fee.

namaria 3y ago
In Brazil notaries get a cut of real estate deed transfers, and the position was hereditary until the 1990s.
- ProjectArcturis 3y ago
  In Italy, getting something notarized costs $1-2k. As far as I know, the position is still passed down from parents to children.
  - morkalork 3y ago
    Are there other officially hereditary jobs still out there?
    - piaste 3y ago
      It's not technically hereditary. But if the job licenses are a finite resource, and the licensee "owns" the license and is allowed to give/sell it to a person of their choice, and the job is reasonably pleasant/profitable... they're very likely to pass it on to their children, unless those children have other plans. Pharmacies in Italy work much like notaries, although they obviously provide a much more useful service. My understanding is that in part of the US taxis work the same way, with limited # of "medallions" being treated as an investment.
    - geraldhh 3y ago
      farmers
somat 3y ago
It sounds like notaries are a different service as well, in the US a notary is a minor(very minor) government official whose primary purpose is to verify that the person signing a document is the person they are claiming to be. For the most part US notaries have little knowledge of the contents of that document. In California (I think other states, but each state has it's own specific laws) the fees are fixed below a small set amount. https://www.nationalnotary.org/knowledge-center/about-notaries/notary-fees-by-state https://www.nationalnotary.org/knowledge-center/about-notari...
- morkalork 3y ago
  At least in Canada, it's not government employees but rather not-quite-a-lawyer types who are glorified ID verifiers.
  - somat 3y ago
    I was a but optimistic on my wording, But in the US they are not government employees(they are not paid any sort of salary) just citizens who are authorized to verify signatures(a governmental duty, which is why I called them minor government officials) and are are allowed to collect a small fixed fee for their effort.
    - deleted 3y ago
      [deleted]
    - hnbad 3y ago
      FWIW in Germany in order to apply as a notary you have to be a lawyer and the number of notaries is very limited and they're lifetime positions. As with all public officials, there are severe penalties for professional misconduct and losing your lifetime position and benefits is usually enough of an incentive to keep these people honest and careful.

pintxo 3y ago

Technically, there is competition. You are free to choose whichever notary you want. But pricing is legally regulated, so you will pay the same price everywhere.

almostnormal 3y ago
The solution is easy: Create a small company to own the property. That company can be sold much more easily than the property itself. It also avoids the tax on propery purchase.
- robocat 3y ago
  Companies have other issues like VAT/GST and reporting. I had a friend use a company in New Zealand and it cost him multiple % of property price due to an issue he didn't forsee. New Zealand doesn't have notiaries or special insurance but you do need to use a lawyer to transfer ownership and I think it costs about NZD1500 each for vendor and buyer.
  - pintxo 3y ago
    Yes, for Germany you can expect at least around 5k/a in costs for accounting, audits etc.
- pintxo 3y ago
  The property tax thing is actually not true. Not if the company only exists to hold properties. The tax office is not that stupid.
rjzzleep 3y ago
The amount of notaries in Germany is very limited. . You can’t just study that and open a notary in Germany. They are cash cows that obviously don’t want competition. During Covid Germany was the only country of its neighbors that did not do remote attestations. From 2000 to 2020 the number of notaries in Germany had almost halved. How is that normal for any country ? Unless they replaced notaries with automation which Germany didn’t .

mensetmanusman 3y ago

Every word they say is worth about €50 then!

alphager 3y ago

The Notar does much more than just read the contract; he is liable for the correct administration of the transfer of ownership (done by a three phase process which guarantees that the seller cannot get the money without transferring the property and the buyer cannot get the property without selling the money). The concept of title insurance doesn't exist in Germany as the Notar eliminates the risk.

nickff 3y ago
From a brief search, title insurance often costs around 0.1% of the purchase price of a property; it seems the Notars are collecting a monopoly rent in Germany.
- StefanWestfal 3y ago
  Common in practice is 0.5%
- rad_gruchalski 3y ago
  They still have to read the deed!
twixfel 3y ago
OK but how is it that other countries get by without them for founding LLCs? Are there countless scams going on in the UK surrounding limited company for example since you don't need a notary there? There's often lots of post hoc justifications in Germany for "why it is that way" (and has to be that way). But nobody ever seems to stop and think: ok but the rest of the world seems to get by OK without these reams and reams of bullshit? The problem with Germany is not that it is stuck in the 20th century and completely backwards, but that nobody seems to care that it is. Worse, if anything there seems to be a degree of pride among Germans of the "process". As soon as you criticise some piece of particular bullshit German bureaucracy (as opposed to bureaucracy in general, which generally you're permitted to criticise) then they start circling the wagons (often pointing to other countries where the situation is supposedly the same or worse). So it is never going to change.

hot_gril 3y ago

This sounds like an escrow.