So let us start from the beginning. Just so you are aware of the buying process in Spain before you go any further. I help you with your search for a property as explained above.
Once you find a property that you like and decide that you want to go ahead. You make an offer and I forward the offer on your behalf. The offer is whatever you feel is comfortable for you and your personal circumstances. But I advise you based on feedback that I already have from the vendors. Be aware that Spanish vendors are not normally as open to offers as other nationalities. Some vendors have mortgages on the properties and need to cover their costs.
Due to the 2007 crisis, many vendors have already reduced by up to 50% of the original price.
A general rule of consensus is to offer between 5-10% less than the asking price. Though every case is different. Some vendors only accept the asking price.
At this point, you state any requirements as to what is included in the purchase such as furniture.
After negotiations and on agreement of a figure for the purchase between yourselves and the vendor. It is normal in Andalucia to sign a reservation and deposit contract. This is first checked by your lawyer. Then a reservation deposit of either € 3000 or € 6000 is placed. Depending on the price agreed upon and the requirements of the agents involved.
In most cases, this money is transferred or paid to the lawyer acting on your behalf. It is held in an escrow account or passed on to the agent or developer. When your lawyer is satisfied that the paperwork is correct. Once the vendor has signed this contract they are obliged to remove the property from the market. Some contracts have penalties in place others do not so you check with your lawyer.
You request that the contract is subject to certain conditions. For example subject to a mortgage approval or subject to a survey etc.
When the property is reserved for you, your lawyer starts all the searches. He checks the documents to make sure that the property is owned by the said vendor. It is duly registered and legal. There are no debts or charges on the property. The cadastral value and the services that are in place.
It is often helpful for you to provide the lawyer with as much information about the property as possible. Such as information from the agent and photos.
An inventory of what is included in the sale is drawn up at this point and added to the contract.
Although in many circumstances, little things come to light at this stage. These can in most cases be rectified between the lawers. An important point is to use a reputable lawyer that is experienced in the property type that you are purchasing.
This process takes about 2 weeks in general. If a mortgage offer is necessary it takes up to 6 weeks as a bank valuation will be required.
When the lawyer is satisfied with all the correct paperwork he prepares a private purchase contract. This is signed at the Public Notary. It is a binding contract in which both parties agree to the sale/purchase of the property. Both parties agree on a date of completion between 1 to 4 months in general. At this point, the purchaser pays the vendor 10% of the agreed purchase price minus the reservation deposit.
Finally, on the agreed date for completion, the new title deed is signed upon completion in front of the Public Notary. The keys are handed over. If you have applied for a mortgage the mortgage title deed is signed in front of the Public Notary upon completion.
Your lawyer will then ensure all of the following:
Register both title deeds with the Land Registry
Pay the Public Notary fee
Pay the Public Land Registry fee
Pay the legal taxes at Malaga Tax Office
Set up all necessary direct debits and standing orders from your new bank account in Spain
Set up utility contracts, local taxes, rubbish in your name
For an extra fee, you can request a Spanish will but discuss this with your lawyer.
The above information is just a general idea of what happens from my experience. For full legal advice a consultation free of charge is available in most cases with the lawyer of your choice. Before you make any commitments or sign anything.
The buying process in Spain for a new build or off plan property is slightly different:
As soon as you choose the new home you want to buy, the first thing the developer asks you is to leave a deposit, usually € 6,000 – € 10,000 which will be taken from the final purchase price. The agreement is subject to preliminary legal checks, mortgage loan availability on the property and a building survey, the deposit is returned if there are problems. Always check with your lawyer before reserving a unit and paying a deposit
New build payment schedules
Reservation Deposit: € 6,000 – € 10,000
Down Payment: Usually 30%
Balance in instalments or upon building completion