Buying guide

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Property law and purchase contract

There is no big different between the Spanish property law and the law from other European countries. Since the 70s the property purchase will as well only be done at a notary by signing a title deed, even if its not obligated by law. Thatfor the purchase risk is not higher than somewhere else. As all documents has to be in Spanish, its absolutely neccessary to hire a lawyer who is responsible for the whole process. In all the towns are several lawyers who are specialized in property law and without any doubt qualified and trustful.
In the moment when all documents are sent to the notary, he is requesting an actually Nota Simple (land registry) . After approvment of all documents, the notary asks all parties, which are neccessay for the signing, to come to the appointment for the transfer of ownership.
If there is from the buyers side no lawyer involved, than most time the notary is choosing a Gestoria (solicitor), who is going to pay all taxes and fees to the tax office and land registration office so that the buyer will be on the safed side, that all is paid. The list of the costs will be told in advance. Immediately after the signing of the title deed, the notary is sending the original deed to the registration office. It takes between 3-6 weeks to receive the title deed, which will be back at the notary to collect.
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Documents requested

– passport, which is valid minimum 3 months
– the title deed, which is registred at the registry office (Escritura Publica)
– document of land registry (Nota Simple) to clarify the owner ship, depts, embargos, mortgages. In case if there are any depts, at the day of signing the title deed all depts has to be cancelled (the donors are signing the conveyance and in return they get paid). This amounts will be reducted from the purchase price. The donors are informed in advance of the notary appointment.
– if the buyer or seller is not able to come to the signing of the title deed, he could authorosize another person/lawyer. This person is allowed to sign with a power of attorney, which has to be in Spanish language. In case if the power of attorney is drawn outside of Spain, the document has to be translated into Spanish by a deponent translator and appostilled.
– last payment receipt of the yearly property tax (IBI)
– last payment receipt of the urbanisation fees (not if its a rustic property)
 – NIE number (Spanish national identity number) requested for buyer and seller (if its not in place, at the department has to be applied for. It takes 10-15 days, normally lawyers are requesting for their clients)
– list of inventory, it the purchase includes furnitures etc.
– 1st occupation license (Licencia de primera ocupacion) for elder buildings could be instead as well a certificate from the townhall.
– new building license (Licencia de obra nueva) in case if its a new building
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Reservation contract and process

In Spain is usually, that the parties are signing a reservation contract after they agreed to the price and conditions of the purchase. The reason why it is important to do so is to block the property and the seller is taking the property off the market. Depending on the agreement the buyer is placing 3000 – 6000 € as deposit to the sellers lawyer. If there is a mortgage involved and it takes little longer (4-6 weeks) to sign the title deed at the notary, the parties could agree on a down payment of 10% 10-15 days after the reservation contract. (usually lawyers are waiting until the mortage is at least verbal approved or approved in principal).
As well its usual in Spain, that the 10% pre-contract includes a penalty for the buyer, in case if the buyer is not going to buy the property in the agreed time. The seller than has the right to keep the down payment and can sell to someone else. Vis a versa in case if the seller is not selling the property in the agreed time, the seller has to pay to the buyer double of down payment. Most time its just <theory>, because practically the parties/lawyers are just going to extend the time limit.

Buying costs

– transfer tax of 8% up to 400000 € of purchase price (if the purchase price is higher, there are higher transfer taxes, but depends.. your lawyer will inform you about the exactly amount)
– 0,2-0,3% fees for the registration of the property
– 0,3-0,5% notary fees
– 1% lawyers fees (never accept more)
If there is a Spanish mortgage involved:
– 0,2-0,3% fees for the registration of the mortgage
– 0,3-0,5% notary fees for the title deed of the mortgage
– 0,5-1% opening fees to the bank of mortgage amount
 – 0,2-0,3% for the valuation of the valuation amount
– 0,5-1% mortgage taxes to the province and Junta de Andalucia
– 300-700 € Gestoria fees of the bank

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