Want to buy property in Spain
Once the clients have decided on the property they wish to buy in Spain, our Law firm will provide them the following services:
- Property approval report issued by an architect-surveyor (optional) : to ensure that the property they are buying has no hidden defects or construction flaws. We recommend our clients to commission this report to avoid future problems.
- Negotiating the Purchase: some negotiations not only involve the property price, as in the bargaining stage other issues could form part of the negotiations such as completion dates, methods of payment, fixtures, fittings, furniture to be included or not, etc.
- Land Registry check: we research the legal situation of the property in the Land Registry, in order to verify if it is encumbered or if there are any limitations to the property or difficulties attached to its purchase. This enables to check if the seller is in fact the real owner of such property. In certain cases, properties are owned by companies and further information needs to be obtained, i.e: Is the person who will sign the contracts the current legal representative of such entity?
- Reservation Contract and Deposit: our lawyers will draft the Deposit Contract (“Contrato de Reserva”), This document will formalize the purchasing terms and conditions and should be signed by both the purchaser and the seller. It usually includes form of payment, completion dates and once this contract is signed it is a binding agreement.
Usually in Spain this Reservation also includes the payment of certain amount of money to demonstrate to the seller the definite intention to purchase. This is known as Señal de Reserva, which is a reservation deposit which can be between €3,000 and €12,000. After paying the deposit the property is taken off the market, respecting the selling price for the agreed period of time, usually around 30 to 60 days.
This deposit will serve as guarantee to the seller in the case the buyer backs off from the agreement. On the other hand, if it is the seller who withdraws their wish to sell the property, the deposit must be returned to the buyer. - Private Purchase Contract: Also known as Contrato Privado de Compraventa, it creates a binding agreement between the parties and sets a completion date as well as the terms and conditions of the sale. It is usually signed between 2 and 4 weeks after the Deposit or reservation contract. During that period of time our firm will obtain the certificate from the Property Registry (Registro de la Propiedad) to control relevant information like: name of the property owner, encumbrances on the land and registered mortgages. Debt certificates for the bank if the property has a mortgage and will have to cancel it on the day of the completion.
- We also make sure no outstanding payments are left on the property (owners community, electricity and water supply) by establishing a formal agreement on the cancellation of these debts before proceeding to completion. Thus protecting the buyer in the case the seller breaches that agreement, by allowing the purchaser to withdraw from the sale and claim for damages incurred or deduct the debts from the sale price along with any related expenses.
It is usual practice in Spain to pay a 10% percent of the purchase price less the deposit. - Power of Attorney: Granting a power of attorney, formally allows another person (either the lawyer or another person that you trust) to sign on your behalf . You can have the POA prepared while you are in Spain, just by making an appointment with the Notary and he/she will oversee all the formalities. As an alternative, a POA can be prepared by a Public Notary in your country of residence, it will have to be legalized with the Hague Convention Apostille if granted outside the European Union.
- Bank Account: If you do not have a bank account in Spain, we open bank account for our clients, and if they need finance, we provide advice on mortgages and put you in contact with several banks so you can obtain a mortgage to purchase the property.
- Completion: A property purchase reaches formal completion when the Purchase deed (Escritura de Compraventa) is signed by both parties (seller and buyer) in the presence of a Public Notary.
The Notary is a public official who certifies that all the legal formalities of the acquisition have been complied with. In the completion of the Deed the agreed amount is paid and possession of the property is handed over to the purchaser.
The Sales contract states that the property is free from all charges and encumbrances, with no outstanding payments related to the property as well as free of occupants or tenants (vacant possession) unless agreed otherwise between the parties. - Registration of the Title Deeds: The Notary sends a fax to the Property Registry to begin the formal registration of the title deeds, once the Sales Deed has been signed, this is done to advance in the registration process. The Registration is done by the Property Register who in facts registers in the Records that the property has been sold and the names of the new owner/s.
Once the registration has been completed the Property Registry will contact your lawyer, and inform that the Title Deed (Escritura Pública) is ready to be collected.
Our services include overseeing the registration of your Title Deed, arranging all the payments arising from the purchase, as well as making the contracts with water and electricity supplies and setting up the direct debit payments from your Spanish bank account.
For further information on purchasing a property in Spain contact us by email: info@lawyersinspain.eu or telephone : +44 (0) 20 3393 4235 / +34 951 08 23 38