In a sale by instalments with retention of title, under Article 1755 of the Civil Code, ownership passes with the last payment, and the risk to the property at handover.
Under Law 207/2025, a reservation is capped at 5% of the price and 60 days, on pain of absolute nullity.
Up to 25% of the price until the structure is complete, and up to a further 20% at the building systems stage, in a dedicated project account.
Non-payment of a single instalment not exceeding one eighth of the price does not allow termination, unless otherwise agreed in the contract.
A preliminary contract during construction, a sale with retention of title, or an immediate sale with a charge for the developer. Each transfers ownership at a different time.
Paying the developer directly: the short answer
It depends on the structure of the contract, not on how much you have already paid. In an instalment plan with the developer (rate la dezvoltator) with retention of title, ownership passes to you only with the last payment, under Article 1755 of the Romanian Civil Code, but the risk to the property passes to you on the day of handover. For a home still under construction, Law 207/2025 caps advance payments and requires a dedicated account. What protects you is a notarial contract and registration in the land register. Correct as of October 2026.
"No need for a bank, you pay us directly, no interest". That sentence sounds excellent, especially to someone whose bank is struggling to approve a mortgage. I do not rule out this route. I only ask that before anything else you ask one question: on the day you have paid 80% of the price, whose house is it?
Three structures called "developer payments"
The same name hides very different legal structures:
| Structure | When ownership passes | What protects you | The main risk |
|---|---|---|---|
| Payments during construction, under a preliminary contract | At the final sale contract, after construction is complete | Law 207/2025, a dedicated account, registration of the preliminary contract in the land register | The developer gets stuck before completion |
| Sale in instalments with retention of title | With the last payment | A notarial contract, registration in the land register, Articles 1755–1757 of the Civil Code | You live in a house still registered in the developer's name |
| Immediate sale with a charge in favour of the developer | On the day of signing | Ownership is already yours; the developer has a charge for the balance | Non-payment may lead to enforcement of the charge |
The difference between the structures is not technical: it determines what happens to your money if something goes wrong at the developer.
During construction: what Law 207/2025 caps
Law 207/2025, known as the "Nordis law", came into force on 11 December 2025. According to a summary by Europa Liberă, these are the main rules:
- Reservation: up to 5% of the price and up to 60 days, on pain of absolute nullity. If the deal falls through because of the developer, the money is returned within 30 days.
- Advance payments by stage: up to 25% of the price until the structure is complete, and up to a further 20% at the building systems stage.
- A dedicated account: advance payments are deposited only in a project bank account, and used only for building that project.
- The preliminary contract: signed only after the building permit has been entered in the land register, before a notary, and the notary must register it there.
This leads to an important conclusion: a "developer" payment plan during construction cannot exceed these caps. A developer who asks you for more than this before the stages set in the law is the first red flag. We set out the practical checks in the Nordis law checklist, and the protection of your money in the article on the dedicated account.
After handover: instalments with retention of title
This is where most of what is called "rate la dezvoltator" sits: the house is finished, you move in, and you pay the balance to the developer in instalments over several years. The Romanian Civil Code regulates this in three articles:
- Article 1755: when payment is secured by retention of title, ownership passes to you with the last payment. But the risk to the property, for example damage, passes to you at handover.
- Article 1756: non-payment of a single instalment that does not exceed one eighth of the price does not allow the developer to terminate the contract, unless otherwise agreed. Note the final words "unless otherwise agreed": a contract can change this protection. Read it.
- Article 1757: if the contract is terminated for non-payment, the developer returns what you paid, but may deduct fair compensation for your use of the house. A court can reduce an excessive deduction.
In practice, this means that throughout the instalment period you live in and invest in a house registered in someone else's name. If the developer has creditors, tax problems or insolvency proceedings, the question of what happens to your house becomes a legal one, and not always a simple one.
Five questions you must ask before signing
- What is the legal structure? Ask for it to be written explicitly: a preliminary contract, a sale with retention of title, or an immediate sale with a charge.
- Is the contract notarial and registered in the land register? The registration (notare) is what tells the whole world you have a right in the property, and protects against a double sale. See the story of the apartment sold twice.
- What is registered against the property today? Get a land register extract (extras de carte funciară) and check whether there is a charge from the developer's financing bank, and what will happen to it when you pay.
- What happens if a payment is late? Default interest, the number of missed payments before termination, and how much will be deducted from your money if the contract is terminated.
- Can you pay early, or move the balance to a bank mortgage? If the house is still in the developer's name, a bank will struggle to finance it. Ask in advance what such a transfer would look like.
"No interest": the question about the price
Developer payment plans are sometimes presented as "interest-free". That may be true, but it is worth comparing the total price with the price for cash or with a mortgage. If there is a difference, it is the interest, just under another name.
A simple comparison: ask the developer for two prices in writing, one for full payment and one for the instalment plan. Compare the difference with the cost of a bank mortgage on the same amount. Also ask whether that difference applies over the whole period or only part of it.
The difference between the structures is not technical: it determines what happens to your money if something goes wrong at the developer.
Why Israelis need to be especially careful
In Israel, the Sale (Apartments) (Assurance of Investments of Purchasers of Apartments) Law requires a developer to provide security for money a buyer pays on a project under construction, and most buyers are familiar with the bank guarantee. In Romania, protection during construction arrived only in December 2025, through Law 207/2025, and it is built differently: caps by stage and a dedicated account, not a guarantee for every payment.
And after handover, on an instalment plan with retention of title, there is no familiar Israeli equivalent. That is why it is important that an independent Romanian lawyer, working for you and not for the developer, reads the contract before signing. What they should check, in the article on the preliminary contract in Romania.
Who a developer payment plan suits, and who it does not
It may suit: people whom the bank will not finance, for example because of age or type of income, and who get a structure in which ownership passes early, or a registered notarial contract with clear protections.
It suits less: people asked to pay most of the price while the house is still registered in the developer's name, without registration and without security. In that case, the convenience of "no bank" is too expensive.
I will mention it once: in our project in Balotești, the financing route is through a Romanian bank, up to 70%, subject to the bank's approval. I recommend asking every developer the questions in this article, including us.
Frequently asked questions
When does the house pass into my name when paying the developer in instalments?
In a sale with retention of title, under Article 1755 of the Civil Code, with the last payment. For a home under construction, at the final sale contract after completion. In an immediate sale with a charge in favour of the developer, on the day of signing. Ask for the structure to be written explicitly in the contract.
What does Law 207/2025 cap on payments to the developer?
For a home under construction: a reservation of up to 5% and up to 60 days, advance payments of up to 25% until the structure is complete and up to a further 20% at the building systems stage, deposit in a dedicated project account, and a notarial preliminary contract registered in the land register.
What happens if I missed one payment?
Under Article 1756 of the Civil Code, non-payment of a single instalment that does not exceed one eighth of the price does not allow termination of the contract, unless otherwise agreed. So it is important to read what your contract says about late payments.
If the contract is terminated, will I get my money back?
Under Article 1757 of the Civil Code, the developer must return what was paid, but may deduct fair compensation for the use of the house, and a court can reduce an excessive deduction. The actual amount depends on the contract and the circumstances.
Can I switch to a bank mortgage partway through the instalment plan?
Sometimes, but it is complicated when the house is still registered in the developer's name, because the bank needs to take a charge over a property owned by the borrower. Ask the developer and the bank in advance what such a transfer would look like, and write the process into the contract.
The bottom line
An instalment plan with the developer can solve a real problem, but the decisive question is not the size of the monthly payment. It is when the house is registered in your name, and what protects your money until then.
If you have received an offer to pay the developer directly, from us or anywhere else, book a 30-minute call with me. We will go through the structure together, identify the clauses that need checking, and prepare a list for your lawyer.
Moti Azulay, Compass Group Romania
Sources and data: Law 207/2025, Romanian legislation portal · Europa Liberă, "The Nordis law has come into force" · Romanian Civil Code, Articles 1755–1757, Euroavocatura · National Agency for Cadastre and Land Registration (ANCPI) · National Union of Public Notaries of Romania (UNNPR) · Monitorul Oficial · Israel's Sale (Apartments) (Assurance of Investments of Purchasers of Apartments) Law, gov.il.
This article is for general information only and is not legal, tax or financial advice. The description of Law 207/2025 and the Civil Code is a general summary; the binding text is the one published in Monitorul Oficial. Every contract is different, and before signing it is advisable to consult an independent Romanian lawyer.
Now you know more.
This article is general information, not legal, tax or financial advice. Consult local professionals before any transaction.
