THE SPANISH PROPERTY BUYING PROCESS – A BREAKDOWN
The process of buying a property in a foreign country can seem a little confusing. SPF promise to always be transparent when offering help and information to make the process as painless as possible.
Below we have provided a detailed explanation of the different steps required in order to make the process more understandable.
So you have chosen your place in the sun, the home of your dreams. Here are the next steps to complete the purchase;
1. Sign the reservation agreement and pay your reservation deposit usually (at the time of writing) €6.000. By signing this reservation agreement you reserve the property for a duration of 30 days and during these 30 days the property will no longer be on the market.
2. Instruct a lawyer. Even though it is not a legal requirement, we always recommend you instruct a qualified Lawyer when purchasing a property in Spain. A lawyer will help you throughout the process making everything easier for the buyer from a legal, tax and administrative perspective.
3. Apply for an NIE. This is an identification number for foreigners issued by the Spanish authorities. The NIE is mandatory to enable you to execute the purchase deed before the Spanish Notary and to pay the property purchase taxes. If you are purchasing in joint names, then you are both obliged to have a NIE number. The NIE can be requested in Spain but also at the Spanish consulate in your country of residence.
4. Open a bank account. Opening a bank account in Spain is a fairly easy process. Having a Spanish bank account is a good idea as;
- It makes it easier to fulfil the final payment at the Notary, and
- It makes the future admin and payment of utilities and taxes more simple to deal with (water, electricity, alarm, etc.)
You can open a bank account by going to a bank in Spain or online depending on the bank you choose.
5. Sign the private purchase agreement. This is a legally binding contract by virtue of which you agree to and are legally bound to purchase the property. From the moment of signing the private purchase agreement the interim payments will start.
6. Paying the initial Deposit. After signing the purchase agreement you have to pay the first deposit payment less the initial €6.000 reservation deposit. Depending on whether you are purchasing off plan with stage payments or a resale will determine how and when further payments are made.
7. Arrange your mortgage. In the meantime you have enough time to, if needed, start arranging your mortgage.
8. Final Sign off. For New builds and off plan properties When the supervising architect declares that the project is complete in accordance with the approved plans he/she will request the First Occupancy Responsible Declaration.
Step 9. Notary Appointment. Once the property is completed for new build or the searches and enquiries have been carried out by the Lawyer for resales, both the buyer and seller must arrange an appointment at the notary public to sign the purchase deed. This is the moment in which the buyer becomes the official owner of the property. At the moment of granting the purchase deed before the Notary the buyer needs to make the final payment.
Step 10. Get your keys. The final most exciting step. As soon as the purchase deed is signed and the last payment is fulfilled, you will receive the keys to your new home in the sun. Enjoy!