Problems with deposit

As I had already agreed on the price for the plot in Rukavac with the seller, after returning from vacation, I undertook to prepare a preliminary contract in Croatian and English, so I asked my notary to do so. I agreed with Krešimir to pay the deposit after we sign the preliminary contract, and the payment of the rest of the money at the beginning of this year. I was counting on the abolition of the real estate transfer tax in 2021, as it was originally announced, so that I could save some money. In Croatia, the real estate tax is 3% of the purchase price, which is not negligible. The second reason was that certain financial resources were on my tied savings, which I could use only from January 1st, 2021.

We quickly agreed on the preliminary contract and all the details, so the payment of the usual deposit followed. As the notary warned me that due to the foreign exchange law, I should be careful with the way money is paid, to not be lazy, I went to PBZ bank in Kutina to inquire about the details. The kind banker explained to me that there are no obstacles to paying the amount from my account via internet banking and that it is important that the seller has the correct instructions from his bank.

Krešimir provided me with the information, and payment followed according to those instructions. The payment passed, the money was taken from my account, but it did not sit in the seller’s account, but reappeared in my account in a few days. Of course, the bank charged its commission and exchange rate differences, which amounted to around HRK 750.00. I was confused and couldn’t figure out where the mistake had occurred because I had done everything well.

The next day, for security reasons, I went to the central PBZ bank on Radnička street in Zagreb, explained what had happened, and asked them to make the payment because I didn’t know where the mistake was. The banker in Radnička did everything the same as me and again paid the same amount from my account and said she did not see where the mistake was. I believed my problem was solved.

Unfortunately, it was not, the money was returned to my account in a few days, and again I was charged about 750 kunas in expenses. I contacted Krešimir to see if the information from his bank was correct because, at the time, it seemed to me that this was a possible cause of the problem.

The seller claimed that his details were in order, so at the urging of a friend and in agreement with the seller, and to reduce bank charges, I made the third payment with a symbolic amount of $ 10.

The money returned to my account as if haunted in a few days. And you guessed it, I was charged that cost as well. The amount has already grown to a total of around 1,800 kunas, without me doing anything and no one in the bank could explain to me where the problem is. Nervousness and panic gripped me. I thought the seller would think I was frivolous and might give up the sale.

Fortunately, my problem was solved when I “pulled some connections” and called my relative at the bank and complained to her about unnecessary expenses and a situation where no one can explain to me exactly how to properly deposit money to America.

Well, here’s where the problem was. In America, there is no IBAN account system, but only an ordinary number, which the Internet application for entering PBZ bank account numbers incorrectly recognizes and pays money into the bank account through which, so to speak, money is imported into the USA. Namely, for the money to go to my seller’s account in his bank in Kentucky, it was necessary to enter the swift number of the intermediary bank through which, probably due to possible money laundering, the money enters the USA. However, due to a different construction of the account number, the PBZ application sent the money to the account of the intermediary bank as the final bank, so it returned the money to me each time because there was no account number of my seller in that bank. If you are ever going to make money payments to the US, remember my problems.

And yes, in the end, I got an apology from PBZ and a refund of all costs due to their mistake. The deposit payment problem was finally solved.

In the following, I will describe the difficulties with signing a contract due to a problem with a coronavirus pandemic.