Earnest Money Agreement Template for Switzerland

An Earnest Money Agreement is a crucial document in Swiss real estate transactions, used when a potential buyer wishes to demonstrate serious intent to purchase a property while negotiations and due diligence are ongoing. The agreement serves as a preliminary contract that binds both parties to the transaction, with the buyer providing a deposit (typically 5-10% of the purchase price) as a show of good faith. This document type is particularly important in the Swiss context due to the country's strict real estate regulations, including cantonal requirements and federal restrictions on foreign ownership (Lex Koller). The agreement must comply with Swiss contract law principles while addressing specific local real estate transaction requirements. It typically precedes the final purchase agreement and includes provisions for the handling of the earnest money deposit, conditions for its return or forfeiture, and the timeline for completing the transaction.

1. Parties: Identification of buyer and seller with full legal names, addresses, and contact details

2. Background: Brief context of the transaction and purpose of the earnest money agreement

3. Definitions: Key terms used throughout the agreement including Property, Earnest Money, Closing Date, etc.

4. Property Description: Detailed legal description of the property including address, lot number, and cadastral details

5. Purchase Price: Total purchase price and payment structure

6. Earnest Money: Amount of earnest money, payment deadline, and escrow agent details

7. Due Diligence: Buyer's inspection rights and timeline for property examination

8. Conditions Precedent: Conditions that must be met before closing, including financing and regulatory approvals

9. Closing: Closing date, location, and required deliverables from each party

10. Default and Remedies: Consequences of default by either party and available remedies

11. Notices: Method and addresses for official communications between parties

12. Governing Law: Confirmation of Swiss law application and jurisdiction

13. Execution: Signature blocks and execution requirements