The purchasing process in eleven steps
1. FINANCING YOUR PURCHASE
Before actively starting to look for your home in Spain, you should consider how you will be financing your purchase. This will allow you to act quickly when the right place comes along. You can normally get a mortage of between 50% and 70% of the market value of a Spanish property, and your loan will be in euros. Another alternative is to mortgage your current home in the currency of your own country. And of course you can always combine the two options. We can help you find the right solution.
2. LEGAL REPRESENTATION
One major difference is that the purchaser in Spain – and frequently the vendor as well – is represented by a legal representative. This legal representative will help you complete the transaction and will safeguard your interests alone. If you’re planning on taking out a mortgage using the Spanish property as collateral, it’s important to check whether your legal representative is approved by the relevant bank to handle the borrowing element as well. Bjurfors Spain will be happy to put you in touch with an appropriate legal representative.
3. NIE NUMBER – NUMERO DE IDENTIFICACIÓN DE EXTRANJEROS
To own a home in Spain you need a Spanish tax identification number, known as an NIE number. That will enable you to be registered as an owner in the Property Registry. You can apply for an NIE number at the Spanish embassy or consulate in your home country, or at a Spanish police station. Note that your NIE is only valid for three months at a time.
4. MAKING AN OFFER
When you have found a home you like, you make an offer. Your offer can include the price, completion date and other matters. Most offers are below the asking price. Offers in excess of the asking price may be made in exceptional cases. However, in most cases you’ll be the only party interested and can enter into negotiations with the vendor.
5. THE PURCHASER’S DUTY TO EXAMINE
As the purchaser, you have a responsibility to examine the property carefully before you sign the contract of sale. Any deviation from this must be specified in the contract of sale. Bjurfors Spain can recommend a number of independent surveyors known for their expertise. The important thing to note is that homes are generally sold as seen and that it’s very difficult – with the occasional exception – to complain about anything once the contract has been signed. Your legal representative can help you investigate the legal status of the property.
6. Contract – “ARRAS” or “Opción de Compra”
When the purchaser and vendor have agreed all the terms and conditions of sale, they sign an “arras” or “Opción de Compra” – a contract of sale. Some terms are mandatory and laid down by law, while others may be freely agreed between the parties. Some terms may be such that the transaction is cancelled if they’re not met, such as those relating to borrowing. A deposit is also paid once the agreement is in place, normally 10% of the purchase price.
7. COMPLETION DATE
On the completion date, the purchaser and vendor meet with their respective representatives and agents at the offices of a Notary Public. This is where the “Escritura Pública de Compraventa” – the certificate of ownership – is drawn up. The identities of the purchaser and vendor and the legal status of the property are confirmed at this point. The notary also deals with the registration of the loan.
The remainder of the purchase price – 90%, plus the notary’s fee and transaction taxes – is paid directly to the notary using a certified bank cheque. The notary receives the sum of money and passes it on to the vendor. The notary terminates any mortgage and arranges a new mortgage if the purchaser is taking out a loan. The notary also pays the taxes, title registration fees and mortgage fees.
Access to the property is almost always granted on the day when the final contract is signed. The notary will give you the keys and you can go to the property straightaway. As properties are always bought as seen, it’s important – as noted previously – that you inspect the property before completion.
10. ACCOUNTS AND INSURANCE POLICIES
Accounts for services such as electricity, gas, water, telephone and the Internet are set up on completion. However, your home insurance is the most important thing to remember as this must be valid as of the completion date. We are always happy to help with this.
People normally choose to buy a home in Spain in order to enjoy the country’s outstanding quality of life. If the buying process is straightforward and everything’s gone well, you can start enjoying your new life just as soon as you step through the door.
If the buying process is straightforward and everything’s gone well, you can start enjoying your new life just as soon as you step through the door.