THE BUYING PROCESS IN SPAIN

Once you have found the home of your dreams in the Spanish sun, and you decide to go ahead and buy it, you will find that things can move much more quickly than in the United Kingdom .  As you would do in the UK , you should instruct a solicitor to act on your behalf to represent your best interests at this point.

You will generally be asked to pay a deposit to secure the property, and then payment terms must be agreed between both parties. 

Resale Properties

With a resale property, once the deposit has been paid, a date will be set to visit the Notary´s office, where the sale/purchase of the property will take place.  The Notary is the official who will oversee the signing of the Title Deed, and who will ensure that the details are correct. 

Vendors and purchasers alike must have an NIE number and Residencia certificate which can be obtained from the local issuing police station before the sale can take place.

If you decide to purchase the property with cash only (no mortgage), the sale can go through very quickly, and will incur less costs.  Your solicitor will obtain a certificate from the Land Registry which will show whether there are any outstanding charges against the property (for example, a mortgage).  If there are any outstanding charges, these must be satisfied by the vendor before the signing of the Title Deed, in front of the Notary.

Costs

You should expect to allow another 10%-15% on top of the purchase price of the property to pay your costs.  Of this amount, 7% of the declared value of the property must be paid in I.V.A (tax).  It is normal practice in Spain to declare the value slightly lower than the actual purchase price and thus save tax.  The buyer generally pays the Notary and Land Registry costs.  There will also be solicitors fees to pay.

Mortgages

If you are mortgaging the property, the banks will charge you a mortgage set-up fee, and commission, and the mortgage will also have to be signed in front of the Notary, and inscribed in the Land Registry, thus generating further charges which have already been accounted for in the 10-15% quoted above.

Banks are currently offering foreign clients approximately 70% loan to valuation.  Mortgages can take some time to arrange, and require the following paperwork:  3 months bank statements, P45, P60, copy of NIE/Residencia certificate and passport, details of any other income or savings.

New Properties

New properties also carry extra charges for registration in the Catastro which is the house registery (1%), and IBI which is property and ground tax. 

Wills

It is a good idea to arrange a Will once you have completed the purchase of the property in Spain .  This Will shall obviously pertain to your Spanish assets.  Your English Will would remain separate and would cover your English assets.  Again, your solicitor will be able to prepare the Will, and you would have to go to the Notary to sign it.