You've found the Property……..what happens now?....and what's all the jargon? |
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Having chosen your property and agreed the price and general terms and conditions of purchase it is customary in Spain to place a deposit to secure the property. This acts as your official confirmation that you wish to proceed with the purchase and also prevents the seller from taking other offers. The deposit is usually 10% in the case of a resale and 3,000 euros in the case of a new build. | UPDATE: If you want to secure a property whilst you are visiting Spain it is important you take sufficient funds with you and we would recommend 3000 euros taken in EURO travellers' cheques is probably the safest way. An alternative might be to take a negotiable International Bank Draft for 3000 euros payable to yourself which you can then pay into an account at a local bank. 3000 euros will cover the full deposit on a new property and will be sufficient to 'Hold' a resale pending the balance of the 10% being transferred on your return home. If you do not take appropriate funds with you then we will request the seller "holds" the property whilst you get home and transfer the money over - however as this can take some time sellers are less than confident over the sale and if they get another offer they may well take it. Whichever option you choose it is always worth opening an account with a Commercial Foreign Exchange company such as Moneycorp before you visit Spain. There are big advantages in using a company such as Moneycorp and if the account is set up before you go you will have no delays in transferring any money over to Spain should the need arise (it also costs nothing to open the account). |
In the case of a resale property or a plot of land the following applies:- - 10% deposit on signing of contract
- 90% On signing the Title deeds usually 6 to 8 weeks after contract however this can be negotiated to suit both the vendors and purchasers individual needs and could be extended to 3 months or even longer.
When purchasing a new property such as a villa in the country or an apartment on the coast the payments are usually broken down into stage payments at different levels of the build. A typical example is as follows but can vary from builder to builder:- - Deposit
- 30% within 30 days of contract
- 30% half way through the build programme
- 40% (less deposit) On satisfactory completion of the building and the handing over of the Title Deeds
These payments can sometimes be negotiated to suit individual purchasers needs, subject to the builder’s approval. IN ALL CASES THE DEPOSIT IS FULLY REFUNDABLE IF YOUR SOLICITOR'S SEARCHES PROVE UNSATISFACTORY. Considerations when buying an old CortijoBuying an old property cannot be taken too lightly as there can be issues associated with ownership and debts. If the property has been handed down from generation to generation of Spanish family then there is a strong possibility it does not even have a current Escritura (Title Deed) proving ownership or any documentation stating where the boundaries of the land are. However these problems can be simply overcome as long as you use a local Spanish Solicitor from step one. They will ensure that all necessary checks and supporting documentation are in place before you commit any major sums of money. In fact our solicitor will usually carry out initial checks prior to even putting the properties on the market - if there are any major problems....she leaves well alone and we look for alternative properties! SolicitorsUnlike the UK where home buyers always instruct a solicitor when purchasing a property, not everyone in Spain does and it is perfectly legal to purchase a property in Spain without instructing a solicitor. Everyone has heard the horror stories. ALL these problems could have been avoided by instructing a solicitor. There is no substitute - use a qualifed independent abogado (Spanish solicitor). The cost of this varies but is usually between 600 and 800 euros. Most work on a fixed charge and are able to give you a complete breakdown of their costs and charges before you instruct them. We have our own English speaking abogado who can act totally on your behalf. Notaries Not to be confused with Abogados (Solicitors). The Notary function is to witness the signing of all public documents, in this case your Title deeds or Escritura before their inscription in the land registry. It is the responsibility of the Notary to verify title to the property. Notaries will also witness the signing of Powers of Attorney and Spanish Wills. EscrituraThis is your title deed and will be signed in front of the Notary on completion of final payment. Once signed this document is sent to the land registry where it is registered in your name "Free of all charges and encumbrances" and a first legalised copy is given to you (Copia Simple). Your solicitor (usually about one month later) obtains the original and sends it on to you once it comes back from the Land Registry. Registro de la Propiedad (Land Registry)Not only is this where your Title will be lodged, it is also where your solicitor will carry out all the original searches concerning your property as all debts on a property to be a "Valid debts" must be lodged here. N.I.E.The NIE is an identification number that everyone has and is on all legal documents in Spain - your Abogado will obtain this for you. There are no restrictions on obtaining one it is purely a matter of filling in the appropiate forms when you are instructing your solicitor. All in all buying a home in Spain can and should be a very simple matter. It is however only intended as a guide and should not be used in place of professional legal advice. |
