Once a suitable property has been found, the purchase terms and price will need to be agreed with the seller. Your Lawyer will complete the appropriate searches and investigations of the property (charges debts etc. in the Land Register) and arrange with the vendor the procedure for the cancellation of any outstanding loans.
Once a verbal agreement has been made, the next step is to confirm the terms of the purchase in writing. Funds are usually lodged in a local bank account or with your Lawyer in order to show the seller there is a real intention to purchase. It is normal practice in Spain to include a down payment to reserve the property until the completion of private contracts.
Upon acceptance of the offer and terms by the vendor the next step in the sales process is to execute the contracts of sale or to sign an option to purchase. This may take place within two weeks following formal acceptance of the offer or sooner. The private contract of sale or option will reflect all the agreed terms of the offer and sale and include the date for final completion at the Notary. It is customary practice at this stage to pay a percentage of the purchase price which is normally non-refundable should the purchaser not complete.
This is an identification number for use by foreigners in Spain. If you have dealings within Spain, even if you are not full time or tax resident, you are required to have a number. This is obtained from your local Police Station at the foreigners' department. There maybe a temptation not to obtain this number however it will cause you great inconvenience in the future if you do not have one.
Depending upon the Local Parliament in which the property is located NIE will be compulsory to pay the taxes. Therefore if the voluntary period to pay the taxes is exceeded a fee will be charged.Your local lawyer will deal with it.
A sale is formally completed in Spain when the public title deeds of purchase are signed in front of a Notary, the final payment has been made, and possession is given to the buyer. The "Escritura" (deed) is the title document which specifies the name of the owner and includes a detailed description of the property. Under Spanish law it is necessary for the "Escritura" to be signed in the presence of a Public Spanish Notary.
The Notary is a public official who is responsible for recording the sale on the public record stipulating the title deed has been signed in his presence and understood by the parties concerned.
The purchaser may attend the signing of the deed in the presence of the Notary or grant a Power of Attorney to representative to attend on their behalf.
Once signed, the Notary will fax a note of the title deed to local Land Register, and your Lawyer will arrange:
There are in principle two fees and three taxes to pay when purchasing property in Spain. Typically, you should budget the combined total of these amounts to be around 16% (if you are taking out a Spanish mortgage) and approximately 12% (if cash buyer) of the purchase price. Brand new property with mortgage approximately 19% and without a mortgage approximately 14%.