Purchasing a Property in Spain

Buying a property abroad is a big decision. However, the buying process in Spain needn't be any more daunting or stressful than in the UK.

In many ways it can be a lot less fraught because once the Preliminary Contract is signed, the seller and the vendor are both legally bound to complete the sale. There is no 'I've changed my mind' or 'gazumping' possible from then on.

However, there is a right way of going about this and there are all the other ways.

This page is designed to lead you down the path to a stress-free transaction and enable you to purchase your Spanish property with the minimum of lost sleep!

First things first: Don't let the dream get in the way of reality. Many people come to Spain and throw all caution to the wind when it comes to buying a property - don't be one of them.

Appoint a Solicitor

This is an absolute must, do not believe anyone who tells you otherwise. Unless you speak fluent Spanish, find one who speaks English and can translate and explain the legal documents. (Note: some lenders impose charges if your chosen solicitor is not on their panel. Please contact us if possible before you appoint your solicitor.)

Your solicitor, first of all, should obtain a Nota Simple on the property you are interested in to confirm ownership before going any further. Do not pay any funds or sign any agreement before you have this easily obtainable, but very important, document.

Obtain your NIE number

NIE is short for Numero de Identification de Extranjeros (Foreigners Identification Number). It is a legal requirement that you have one before you carry out any transaction which has tax implications such as buying a property. An NIE number is easily obtained by visiting the foreigners department of most Spanish police stations.

Arrange Your Mortgage

It is always a good idea to try and get a decision in principle from the bank before you embark on paying any deposits, etc. so you have prior knowledge of any unforeseen problems in getting the required amount to enable you to proceed with the sale. See also our mortgage requirements page.

It is common practice for your mortgage lender to request a valuation from one of their panel of valuers.

If you are transferring currency from your home country, don't just rely on your bank for an exchange rate, do some research and get the best rates you can - it can make a sizeable difference to your bottom line.

It is always best to use an international foreign exchange and payments specialist whose currencies expertise can get you the best commercial exchange rates available, thus making your money go further.

For further information see our maximising your deposits page

Sign Preliminary Sale Contract / Pay Deposit to Secure Property

Once the preliminary legal work has been done, the Private Contract is the principle document where the seller and purchaser agree to the details of the sale/purchase. (Property description, price, terms, completion dates, etc.)

This is also the point when you pay your deposit and both sides are committed to the transaction. The amount of the deposit is agreed between both parties and is taken to be part of the purchase price.

This deposit is non refundable, therefore it is important to establish that you have the funds in place, whether it be personal or by way of a mortgage, before signing the Private Contract.

Calculate All Costs Involved

Estate agent fees, taxes, valuation fees, notary administration and legal fees.

Allow between 10% and 15% on average.

Click this link for our page on spanish mortgage costs

Wait for Solicitor to Complete Legal Investigation

Amongst other things, he/she will check that the owner has authoriy to sell, if the property has the full and correct title deeds and whether there is any outstanding debt on property, etc.

Arrange Date for Completion and Signing In Front of Notary

In Spain, a sale is formally completed when both parties take the Private Contract to a Notary, where the remaining balance of the purchase price is paid, be it private funds or mortgage funds, and in order to make it in to a Public Deed for registration in the Property Register.

The Public Deed clearly specifies the location, features, neighbouring spaces, boundaries, area, price, payment plan and conditions concerning possible delays in payment.

Under Spanish law, it is necessary for these deeds to be signed in the presence of the Notary. You may attend the signing of the deed yourself or you may grant a Power of Attorney to represent you and attend on your behalf.

Once the public title deeds of purchase are signed in front of the Notary, and the final payment has been made, legal possession is given to the buyer.

Pay the Applicable Fees and Taxes

As stated above, this is normally around 10%-15% of the purchase price.

Here's the link again for our page on spanish mortgage costs

Title Will Be Registered at Land Registry

Once the deeds are signed the Notary will fax a note of the title deed to the local Land Register and your lawyer will arrange:

• Payment of any transfer taxes associated with the purchase
• Registration of your title deeds (this may take up to 4 months)
• The transfer of accounts with local utility suppliers and organise payment from your bank account

With over 30 years experience and offices in both the UK and Spain we are uniquely placed to assist you with your purchase and any mortgage requirements you may have. We also have access to most banks and building societies offering mortgages in either Euro or Sterling.

Please contact us or go to our application form for a competitive pre-approval.

 

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