Buying Spanish Property
Once you have decided on the
Spanish property you wish to purchase and the terms and
conditions have been negotiated with the vendor then a deposit
of 10% of the purchase price is required as official
confirmation of your intent to buy that Spanish property. The
remaining 90% is payable on the signing of the title deeds
before the Notary.
If you are purchasing a new
construction then the constructor will ask for stage payments to
be made on the property. These can vary dependent on the
constructor and the length of time remaining to completion of
the construction.
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Appointing a solicitor (abogado)
Whilst it is not a necessity to
have a solicitor to purchase a villa in spain, it is highly
recommended. They will be able to do the necessary searches and
check out any outstanding debts that may exist on the property
as well as help with contracts and NIE numbers. They will also
check the legal paperwork and make sure the property has the
required permissions. You are free to appoint a solicitor of
your choice, or if you prefer we can recommend one.
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NIE number (Numero de
Identificacion de Extranjeros)
It is essential to have an NIE
number for any financial dealings you may have in Spain,
including buying Spanish property. Obtaining an NIE number is a
simple process that will normally be dealt with by your
solicitor at the same time you make your purchase and the price
for this is generally included in the fee for the conveyancing.
However, you can apply for one separately via a Gestor (fiscal
representative) who will normally charge around 30 or 40 Euros.
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Applying for a Bank Account
Whilst it is not a necessity to
have a Spanish Bank Account to purchase a property in Spain, it
is generally a good idea. Again, the solicitor will usually make
all the arrangements for you at the same time as the
Conveyancing. If you prefer to arrange a bank account yourself
we can help with recommending good local banks with staff that
speak English.
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Applying for a Mortgage
You can choose to apply for a
mortgage in Spain or from the UK. Mortgage rates in Spain tend
to be slightly lower than in the UK, currently around 5% but the
arrangement fees are usually much higher. Spanish banks will
normally lend up to 70% of the property value (not necessarily
70% of the purchase price). You will need to prove that you have
sufficient income and you will also need to put down a minimum
20% to 30% deposit.
It can often be more practical
and cost effective to simply re-mortgage your home in the UK. We
can arrange for a consultation with a fully qualified and
independent mortgage advisor if you would like to discuss your
options.
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Your Solicitor
Your appointed solicitor will
carry out all necessary searches on the Spanish property; to
ensure that it is owned by the vendor, it has planning
permission, there are no outstanding debts or charges on the
property etc.
Once the searches on the property
are satisfactorily completed the deposit (usually 10%) will be
paid and a completion date will be agreed in accordance with the
terms and conditions of the contract. The next step is for the
title deeds to be signed by both the buyer and the seller before
the Notary on the day of completion.
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The Notary(Notaria)
This is a solicitor appointed by
the Spanish government to witness the signing of all legal
public documents. In this case the title deeds (escritura) of
the property. He represents both the buyer and the seller. The
Notary fees are around 1% of the purchase price of the property
and must be paid at the time of the signing of the deeds.
The Original signed document is
retained by the Notary who will apply for a formal change in the
land registry. The purchaser will receive an initial legal copy
of the title deed which is signed and stamped by the Notary. The
official title deed can take a while to be processed and until
then this is your official proof of ownership and must be kept
in a secure location.
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Purchase Taxes and fees
We recommend that you allow a sum
of around 9 to 10% of the price of the property to cover payment
of purchasing fees e.g. land registry fees, notary fees, legal
fees, transfer taxes.
If you are purchasing property in
Spain we suggest you consult with a professional financial
adviser beforehand to discuss any possible financial/tax
implications regarding Spanish or UK income tax, capital gains
tax or inheritance tax.
