What to do when you are buying a property has come to the seller through gift (donation)

If you’re considering purchasing a property in Italy, it’s essential to understand the complexities of the property’s title by which the seller acquired the property. Although in other legal system it may make no difference how the seller acquired the property, in Italy, when the seller is disposing of a property acquired though a donation (that the transfer occurred without any payment of money), there are some aspects to pay attention to. Here’s the main issue you need to know to protect your investment in case you are purchasing a property that the seller received by donation.

The Importance of Time in Property Donations

Italian inheritance law is designed to protect the rights of certain close relatives, such as children, spouses, and parents. These relatives are entitled to a “minimum quota” of the estate, which cannot be overridden by a will. If the property you’re eyeing was obtained through a donation, and less than 20 years have passed since that donation, these inheritance rights could still pose a risk to your purchase.

Potential Challenges

If a “legitimate” heir (children, spouse, parents) believes their inheritance rights have been compromised by a donation, they may challenge the transaction. If the donee (the recipient of the gift) cannot satisfy the heir’s claim due to insufficient assets, the property may need to be returned. This could leave the current owner—and potentially you as the buyer—facing significant legal and financial setbacks, especially if the 20-year period hasn’t elapsed.

Mitigating Risks

Fortunately, there are steps you can take to mitigate these risks:

1. Conduct Thorough Due Diligence: Before proceeding with a purchase, it’s crucial to investigate the property’s history. Determine whether any legitimate heirs exist and if they might have a claim. Also, check if the 20-year period has passed since the donation, which significantly reduces the risk of future challenges.

2. Consider Insurance: One effective way to protect yourself from potential claims is to obtain an insurance policy specifically designed to cover risks associated with donated properties. This type of insurance can provide financial protection and peace of mind, ensuring that your investment is secure.

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