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 property 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 could be to mortgaging 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. The buyer freely chooses his legal representative. Bjurfors Marbella will be happy to put you in touch with an appropriate legal representative.
The legal representative will check whether there are any deficiencies in the property register. Checking that the property is not charged by old mortgages, easements, that the property is really owned by the person who claims to be the owner and that no old bills are due for payment. They also help to apply for the Spanish Social Security Number (NIE) and a bank account in a Spanish bank. In addition, they will make sure to contract electricity and water as well as seting up direct debits for these bills.
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. Your legal representative will apply a NIE number for you during the purchase process and the cost of this is already included in their fee. If you wish you may apply for an NIE number at the Spanish embassy or consulate in your home country, or at a Spanish police station.
4. MAKING AN OFFER
When you have found your dream home, it´s time to place an offer. Your offer can include the price, completion date and other detailes. Most offers are below the asking price. Offers in excess of the asking price happens in exceptional cases. However, in most cases you’ll be the only party making an offer and can therefore start negotiations with the vendor shortly.
If the purchasing process has gone smooth, you can safely start enjoying life with your new property
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 you may find must be specified in the contract of sale. Bjurfors Marbella can recommend a number of independent technicians known for their expertise. The important thing to note is that homes are generally sold in the state as seen and that it’s very difficult – with the occasional exception – to claim any compensation once the contract has been signed. Your legal representative can help you investigate the legal status of the property.
6. Contract
Once the buyer and the seller agree all the terms and conditions of the sale, we often sign a reservation contract, and in that case, the buyer usually deposits € 6,000 to Bjurfors Client Account. Once the reservation contract is signed, the property will be removed from the market. The buyer's and the seller's legal representative will then begin their due diligence for the property and prepare the Private purchase contract "Contrato de Compraventa”.
Some terms in the contract are mandatory by law, while others may be freely agreed between the parties. Some terms may be such that the transaction will be cancelled if they’re not met, such as subject to mortgage. 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. Alternatively, the legal representatives has been given power of attorney so that the purchaser and vendor would not need to be present physically. 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.
8. PAYMENT
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.
9. COMPLETION
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. Your legal representative is always happy to help with this.
11. ENJOY
People normally choose to buy a home in Spain in order to enjoy the country’s outstanding quality of life. If the purchasing process has gone smooth, you can safely start enjoying life with your new property.