Buying Spanish Property: a Description of the Legal System
October 5th, 2009
Once youve chosen your ideal property and found a Spanish mortgage how do you go about completing the purchase?
It is in your best interest to hire an English-speaking lawyer to assist you in the process of purchasing regulated Spanish property. Validate that the Spanish property you plan to purchase is free of restrictive clauses and debts.
The legal process for purchasing property located in Spain falls under two types of transactions. First you have the Contrato privado de compraventa, or the preliminary contract, and then you have the Escritura de compravents, or completion contract.
There should be a preliminary private sales contract signed once you have both agreed on a purchase price. Before the Contrato privado de compraventa is signed, the vendor must show proof of ownership, and also proof that there are no liens or judgements against the property. Debts are charged to the property themselves in Spain, and any outstanding mortgage amount would then be passed on to the purchaser. Nota Simple determins which properties contain overdue debts.
The preliminary sales contract will be drawn up to contain all of the necessary details including the date of completion, the purchase price and the description of the property. A 5% to 15% deposit of the final purchase price will be required. These funds will be held for you in a bonded client account. A person would theoretically be able to sign the initial sales contract without a deposit, but it isn’t necessarily a good idea.
The Escritura de compraventa stage, is the second or final contract stage. The purchaser will be required to pay the balance of the purchase price and all fees on the date of completion. The vendor and the purchaser will then come together to sign the contract, which is equivalent to a deed on the property. The purchaser will receive the public deed of conveyance, known in Spain as the escritura, in front of a Notary Public. A copy of this deed will also be passed to the tax office and to the property registry as well to make everything legal. If you are in Spain, a Notary Public will be required as a witness on you deed of sale. Don’t just rely in that, though. You will want to have your own lawyer to keep your best interests foremost throughout the proceeeding. While buying any property do remember that property sales taxes and legal fees for the Notary Public is also to be paid by you only.
Entry Filed under: Lawyers' World, The Real Estate Brokers Way, Useful Tips