Buying Guide

The legal information you need to know

Safe Purchase Partner

Once you find the property you want to buy, you will need to pay a reservation deposit. Usually, a deposit of 3000EUR is enough and this is paid either in cash or by credit card at the estate agents office, enabling the vendors to take the property off the market immediately. Estate agents have standard reservation contracts, but it’s advisable to get your own lawyer, ideally a (Safe Purchase Certified Lawyer) to approve or prepare this document, so you’re made fully aware of your legal position by an independent adviser.

Your lawyer will do all the necessary searches to ensure that there are no charges against the property, that the property is legal and registered with the land registry, and the title deed is in order. This will take an average of two weeks.

In the meantime, open a bank account. A deposit of 200€ will be sufficient to do this.

Once the lawyer is satisfied that everything is in order, you will need to transfer a deposit of 10% of the purchase price (less the 3000€ reservation deposit) into your Spanish bank account. Your lawyer will advise you of the exact amount required. More money will be required in due course and your lawyer will explain the correct amounts and when the funds need to be made available.

At this stage, the private purchase contract is drawn up and the completion date entered as agreed (usually as stated in the initial reservation contract).

When both parties (or their legal representatives) sign, the agreement is legally binding. If you back out now you will lose your 10%. If the vendor withdraws, he has to pay you an additional 10%. This law deters “gazumping” as we call it in England.

Before you can complete the purchase you will require a NIE number (one each if the property is to be bought in joint names). You can obtain these from the Spanish consulate in the UK, or an application can be made here from the main police station. It usually takes about four weeks to obtain the NIE, which is your tax identification number against which your property purchase tax of 7% will be paid.

Visit the Spanish Consulate website

You can complete the purchase yourself, with your lawyer, at the Public Notary. Alternatively, you can give your lawyer power of attorney to purchase in your absence or your lawyer can temporarily sign on your behalf but this must then be ratified with him at the notary when you visit next time.

On completion, if you are buying from a non-resident, your lawyer will withhold 3% of the declared value on behalf of the vendor. This is to ensure that the vendor’s capital gains tax liability is paid. The vendors and/or their representatives will be present and the final sum of money is handed over to them in exchange for the keys to the property and the new title deed prepared by the Notary.

The property is now yours and the Notary sends official notification by fax to the Land Registry.

Your lawyer will arrange for the payment of additional purchase costs of approximately 10%. Notary fees, land registry fees and legal fees amount to about 3% of the purchase price, and the remaining 7% is the Spanish Purchase Tax. Your lawyer will pay this at some stage within 30 days of your purchasing the property. This is done through your bank and the lawyer will give you the associated paperwork.

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