You’ve found the house in Spain you’ve always wanted and now it’s all systems go. But you’re not buying a property in your own country and all the usual routines that you’ve probably been through before are absent. So what can you expect?
If you haven’t come across the NIE (Número de Identificación de Extranjeros) before, now is the time to start the process of obtaining one. It’s a very important identification number that every foreigner with a financial interest in Spain must have. You cannot buy a house without it.
Having an NIE means that you are registered with the Spanish Tax Authority and you will be asked for it every time you make an official transaction here. The NIE must be applied for at the Foreigner’s Office or National Police Station.
What many people are not aware of and has caused confusion in the past is that before you sign the Title Deed in Spain you sign a private contract between the buyer and seller. This isn’t logged on an official registry but in law it is considered to be legally binding.
People have sometimes signed this contract without having a check done on the property or even the contract itself. It is vital that you have any contract checked before signing and that you don’t part with any money until this has been completed along with a check on the property itself. The solicitor you have appointed will do this for you.
It is important that the price declared for the purchase is what is recorded on the documents you sign. Declaring a lower price is against the law. When you sign the private contract you will pay a deposit. If you, as purchaser, break the contract you will lose your deposit. If the vendor is the one who defaults then you are entitled to twice the amount of your deposit as compensation.
The private contract includes agreement about who will pay the expenses surrounding the sale. The purchaser pays everything in Spain except the plusvalía which the seller must pay by law. If the property is being sold by a property developer it is illegal for the buyer to take on an expense that legally is the responsibility of the seller.
Signing the Title Deed
Once the necessary checks have been completed then the paper work will be prepared ready for signing. The Title Deed will need to be signed at the Notary. The Notary is a professional within the Spanish law system whose main function is to certify Spanish documents ensuring that private agreements fulfil certain legal criteria. You have the right to choose who you would like this Notary to be.
Signing the Title Deed includes:
- Checking the identity of the seller and buyer
- Highlighting any debts that are held against the property
- Checking that any community fees have been paid
- Requesting proof of payment of the IBI property tax and informing officials of the change of ownership
- Informing those signing of their legal and fiscal obligations following the sale
- Explaining the sharing out of expenses between the two parties
- Managing payment, if it’s requested, of the different expenses that accompany the process
Never sign anything that you don’t understand or that you aren’t completely sure about. Once you have signed the Title Deed, you can’t go back.
If you have a mortgage on the property the Title Deed will be kept with the mortgage details by the mortgage provider but you will receive a copia simple (legal copy of the Title Deed). Once the mortgage is paid then you will be given the Title Deed.
If you purchase without a mortgage, you will be given a copia simple when you sign the Title Deed at the Notary’s office. You will then receive the original Title Deed when you register the property at the Spanish Land Registry.
Make a note of the notary who signed it so that if you do need a replacement at some point you are able to obtain another copy of the original.
The property is yours
With the official paper work completed you now have your own Spanish home. There will still be some arrangements to make to ensure that utilities and taxes are paid without a hitch. However, the main tasks are over and you can start to relax and enjoy your new house in Spain.
This article is based upon the information supplied in our property conveyancing handbook ‘Buying a property in Spain’.