Preliminary Agreement for Arrested Real Estate: Procedural Risks and Purchase Algorithm

Last updated: March 2026

Table of Contents

Legal Nature and Architecture of the Mechanism
Situation Development Algorithm (Decision Tree)
Procedural Bottlenecks
Documentary Support and Evidence
Real Terms and Expectations
Procedural Risk Matrix
Summary
FAQ

Purchasing real estate that is under arrest in the State Register of Property Rights (DRRP) requires targeted repayment of the seller’s debt using the buyer’s funds. The process is structured through a preliminary sale and purchase agreement. A critical point of failure arises at the stage of removing the encumbrance: due to bureaucratic delays by the executive service or database desynchronization, the arrest is not removed before the strict deadline of the preliminary agreement expires. As a result, the transaction falls through, the funds are blocked with the seller, and the buyer does not receive the property.

Practice
The main misconception among buyers is the belief that a preliminary agreement guarantees the receipt of a specific apartment through the court in case of the seller’s refusal or untimely removal of the arrest. According to the Resolution of the Supreme Court of Ukraine No. 6-226cs14, the court cannot compel the conclusion of the main agreement, but will only award damages.

An additional risk factor is the incorrect qualification of the transferred funds. By naming the payment “earnest money” (zavdatok), the buyer expects its return in double the amount if the transaction falls through; however, courts consistently recognize such payments as an advance payment. Furthermore, the existence of a paper resolution from the executor on the removal of the arrest is not a basis for certifying the transaction — the notary requires exclusively a clean electronic extract from the DRRP.

Legal Nature and Architecture of the Mechanism

The procedure for purchasing arrested property involves four independent systems, the conflict between which generates the main procedural risks:

Civil law (principle of freedom of contract);
Notary (certification of transactions and verification of encumbrances);
Executive Service / DVS (debt repayment and removal of arrest);
DRRP (electronic register of property rights).

The failure trigger is the time gap between the issuance of the DVS resolution and the actual deletion of the record from the DRRP. It is precisely in this “window of vulnerability” that the appearance of new creditors or the expiration of the preliminary agreement terms is possible.

Situation Development Algorithm (Decision Tree)

Depending on the stage of arrest detection and the actions of the executive service, scenarios of event development require different procedural reactions.

Scenario and Conditions	What happens in the system	Risks and consequences	Action algorithm
Notary discovers the arrest during transaction preparation The parties applied to sign a preliminary agreement.	The notary sees a block on alienation. A preliminary agreement is not an alienation.	Refusal by an incompetent notary. The buyer’s misunderstanding of the essence of the transaction (“promise to sell”).	Insist on certification. Fix in the text a strict obligation of the seller to remove the arrest by a specific date. Do not transfer money without notarization.
The debt is repaid, but the arrest remains in the DRRP The term of the preliminary agreement is expiring.	The executor delays sending the resolution or a technical failure occurred in the interaction between DVS and DRRP.	The obligation to conclude the main agreement terminates automatically. The buyer loses the right to demand the conclusion of the transaction.	Control the physical dispatch of the resolution. Upon expiration of the term — record the termination of obligations, demand the return of the advance payment. Do not sign the agreement “backdated”.
Appearance of a new (cascade) arrest The first debt is repaid, but a new arrest appears before the transaction.	The DRRP records a new encumbrance. The preliminary agreement does not give the buyer priority.	The main agreement is technically blocked. The buyer joins the general queue of creditors.	Refusal of the main agreement. Immediate initiation of judicial recovery of the transferred funds from the seller. Do not repay new debts without revising the conditions.

Provision of the Law
The notary’s refusal to certify a preliminary agreement due to an arrest is unlawful (Art. 5 of the Law of Ukraine “On Notaries”, Information Letter of the NPU). Upon expiration of the preliminary agreement term, obligations terminate automatically according to Part 3 of Art. 635 of the CCU.

Procedural Bottlenecks

The practical implementation of the mechanism faces a number of critical failure points that block the transfer of ownership rights.

Bureaucratic lag of the DVS: The trigger is the payment of the debt. The resolution is issued not in one day, but in a week. Diagnosed by the absence of the document in the ASVP. Requires personal control of the executor.
Desynchronization of DVS and DRRP: The resolution is issued but not uploaded to the register. The notary refuses the transaction based on the DRRP extract.
Qualification of the payment: Using the term “earnest money” in the preliminary agreement leads to the court recognizing the payment as an advance, subject to return strictly in a single amount.
Hidden co-owners: The arrest is imposed on the share of one spouse, but the consent to the transaction is given by the other. If the transaction falls through, the second spouse can block the return of funds from their share.
Death of the seller: Physical death before the removal of the arrest leads to the freezing of funds for at least 6 months until the heirs enter into their inheritance rights.

Documentary Support and Evidence

To minimize risks, strict control of legally significant documents at each stage is required.

Notarized preliminary agreement: Records the obligation and the fact of the advance payment transfer. A simple written form entails the nullity of the transaction.
Receipt of debt payment to the DVS: Confirms the targeted use of the advance payment.
Resolution on the removal of the arrest: An internal DVS document, insufficient for conducting the transaction without updating the register.
Extract (Vityag) from the DRRP: The only legitimate document for the notary, confirming the absence of encumbrances at the time of signing the main agreement.
Spousal consent: Must contain a clause on joint and several liability for the return of the advance payment in case the transaction falls through.

Provision of the Law
A preliminary real estate sale and purchase agreement is subject to mandatory notarization. Violation of this requirement entails its nullity according to Art. 657 of the CCU.

Real Terms and Expectations

The gap between the formal requirements of the legislation and the actual operation of state registers is the main reason for the failure of preliminary agreements.

Procedure stage	Formal term (Law)	Real term (Practice)	Point of no return
Issuance of the resolution on the removal of the arrest	No later than the next working day after payment	From 3 to 7 working days	Absence of the document in the ASVP after a week
Updating data in the DRRP	On the day the registrar receives the resolution	From 2 to 14 days (technical failures, queues)	Date of conclusion of the main agreement
Validity of the preliminary agreement	Determined by the parties	Strictly fixed date	00:00 of the date specified in the agreement

Practice
Despite the requirement of Art. 59 of the Law of Ukraine “On Executive Proceedings” to remove the arrest the day after payment, the actual deletion of the record from the DRRP takes up to 14 days.

Procedural Risk Matrix

When structuring a transaction, it is necessary to consider non-standard scenarios that can lead to the loss of the advance payment.

Risk	Severity	Trigger and Consequences	Defense mechanism
“Burning” of terms due to the executor	High	Delay in updating the DRRP. Annulment of obligations under Part 3 of Art. 635 of the CCU.	Include in the agreement +14 days to the expected term for removing the arrest.
Cascade arrests	Fatal	New debt of the seller. Blocking of the transaction, loss of the buyer’s priority.	Maximum reduction of the gap between the removal of the first arrest and the transaction.
Death of the seller	Fatal	Death after receiving the advance payment. Transfer of debt to heirs, freezing for 6 months.	Absolute legal protection does not exist.
Blocking of return by a spouse	Medium	Failure of the transaction with a fractional arrest. Refusal of the second spouse to return part of the advance payment.	Fixation of joint and several liability in the preliminary agreement.
Impossibility of compelling the transaction	High	The seller removed the arrest but refused to sell. The court will deny the claim for ownership rights.	Strict penalty sanctions in the preliminary agreement.
Requalification of earnest money into an advance payment	Medium	Incorrect interpretation of Art. 571 of the CCU. Return of only the transferred amount.	Prescribe the penalty for refusing the transaction separately from the advance payment amount.

Risk
The preliminary agreement is not registered in the DRRP as an encumbrance in favor of the buyer. This creates a fatal risk of new (cascade) arrests being imposed by other creditors in the period between the repayment of the first debt and the conclusion of the main agreement.

Summary

When buying an apartment under arrest, it is necessary to conclude exclusively a notarized preliminary agreement. The transferred amount should be specified as an advance payment with penalty sanctions, avoiding the term “earnest money”. In the terms of the agreement, it is necessary to include at least 14 additional days for the bureaucratic procedures of the executive service. The main agreement is impossible until the physical disappearance of the arrest record from the DRRP, and upon expiration of the preliminary agreement terms, the obligations of the parties are annulled.

FAQ

Can a notary refuse to certify a preliminary agreement due to the presence of an arrest in the DRRP?

No, this is unlawful. A preliminary agreement is not a transaction for the alienation of property, so the presence of an arrest does not prevent its notarization (according to the position of the Notary Chamber of Ukraine).

Is it possible to force the seller to sell the apartment through the court if they removed the arrest but changed their mind?

No. Judicial practice (Resolution of the Supreme Court of Ukraine No. 6-226cs14) shows that the court cannot compel the conclusion of the main agreement, but will only award damages to the buyer.

If we called the payment “earnest money”, will the seller return it in double the amount if the transaction falls through?

No. Courts consistently qualify such payments under preliminary agreements as an advance payment, which is subject to return strictly in a single amount.

How long does it take to remove an arrest after paying the debt?

By law, the executor is obliged to issue a resolution no later than the next working day. However, in practice, the actual updating of data in the DRRP takes from 2 to 14 days.

What happens if the term of the preliminary agreement has expired, but the arrest is still pending in the register?

According to Part 3 of Art. 635 of the CCU, the obligation to conclude the main agreement terminates automatically. The buyer has the right to demand the return of the transferred funds.

Does a preliminary agreement protect against the imposition of new arrests by other creditors?

No. A preliminary agreement is not registered in the DRRP as an encumbrance in favor of the buyer, so the risk of new arrests remains until the registration of ownership rights.

Is a paper resolution from the executor on the removal of the arrest sufficient for the notary?

No. To certify the main sale and purchase agreement, the notary requires exclusively the absence of an arrest record in the electronic database of the DRRP.

What happens to the transferred money if the seller dies before the arrest is removed?

The obligation to return the debt passes to the seller’s heirs. The process of returning funds is frozen for at least 6 months until they enter into their inheritance rights.

Is it possible to conclude a preliminary agreement in a simple written form?

No. According to Art. 657 of the CCU, a preliminary real estate sale and purchase agreement is subject to mandatory notarization. Violation of the form entails its nullity.

Does the seller’s wife have the right to refuse to return her part of the advance payment if the transaction fell through due to her husband’s arrest?

Yes, if the preliminary agreement did not explicitly stipulate the joint and several liability of the spouses for the return of funds in case the transaction falls through.

Author: Analytical Department of Poland Documents
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The material was prepared by the analytical department of Poland Documents. The information is of an analytical nature and does not constitute individual legal advice.