There are several formalities in connection with purchasing a property in Spain; like it is in every country. In addition to a lack of understanding of the language and the distance, many may feel a bit insecure about what is going to happen, and when and where and how.
Everything is being taking care of, the client does not have to worry. Here we are giving you a general overview that hopefully should give you the answers.
The Law Firm Euro-Abogados
They will read through the purchase contract and check that the payments are in accordance with what is agreed upon. The Law Firm also has a multilingual staff and one person will go with the client to assist at the Notary to translate the Title Deed and whatever is necessary. This service is not free, but we recommend it to secure a correct, formal and safe take over of the property.
The Membership Club (highly recommended)
We also recommend the client membership club that Euro-Abogados has initiated. As a member you will have certain benefits at a special price and they will then arrange for your N.I.E.-number (a fiscal number), get the water and electricity contracts to be set up, take care of the tax report to the authorities every year, pay taxes and other costs on your behalf and do other administrative work in connection with all this. The yearly membership fee is €200,-. Euro-Abogados may also assist you in taking care of all your insurance needs.
All property owners in Spain are obliged to register a N.I.E.-Number, a fiscal number. Also the bank is asking for this in connection with opening a bank account and mortgage. Do not worry about how to obtain this, Euro-Abogados can help you. You will need two passport photos, a passport copy with a stamp from the Notary and a document with personal information for the National Police Office. When all this is done, the N.I.E.-Number are being issued.
Opening a bank account and payments of bills
All foreign property owners in Spain must open a bank account in a local bank. The account will be used for withdrawing funds for payments of electricity bills, water, taxes etc. It is important that you always have sufficient funds in your account to cover these expenses, otherwise you are risking that the power or water are being shut off without notice.
If you are considering a mortgage in Spain the interest rate is about 4,75% for the time being. The mortgage has to be signed and registered with the Notary and also registered in the public Property Register (Registro de Propiedad) together with the Title Deed (escritura). It is also other costs to be paid in connection with the mortgage.
The costs of establishing the loan usually is maximized to 2% of the mortgage amount, but nowadays some banks have been lowering this to 1,5%. The property needs to be evaluated by neutral professionals and this will cost about €250,- - €300,- and this cannot be done until completion. It is important that the purchaser informs us if he wants a mortgage at least three weeks before supposed completion date because of other documentation that needs to be in order as well before you can take over the property.
The mortgage needs to be signed at the Notary and at the same time it will be registered in the property register. This will cost 1% of the mortgage amount. If you want to pay the loan before the last payment date, it will be a cost of 1% of the remaining mortgage amount. Mortgages should be terminated within the client is 75 years old.
Electricity and water
Usually the new home is within an urbanization that is still not finished and it still might be some building activities within the area. It will probably be arranged for both water and electricity from the builder before you arrive. This is, however, a special arrangement where the builder is paying the bills during most of the construction period and he of course then will soon cut off this services. That is why it is so important that this is registered and in order on beforehand to avoid problems later on. Euro-Abogados will take care of this for you if you want to.
Like in the most European countries you will need a formal permission document to be allowed to move into your new home. Normally the document is issued by the town hall and firstly they issue a preliminary one and some months later the permanent one.
Without this preliminary permission the Title Deed cannot be issued and it is not possible to order electricity or water. The ayuntamiento (Town Hall) is very busy and it may take extra time and this may cause that your take over of your property will be delayed.
When you book your trip to Spain because of the take over of your new home, please assure yourself that absolutely everything is ready for you before leaving. Please contact us in due time and DO NOT book your flight or travel until absolutely everything is 100% sure.
If it still is electricity and water in the house from the builder, you might be able to take over and move in. You may also give a power of attorney to Euro-Abogados so they can sign the Title Deed and other documents on your behalf, that makes it very convenient for you if you for some reason cannot travel at the time of signing at the notary.
Issuing the permission usually is a formality, but this is Spain and the bureaucracy works quite slow, so it may take some time. The agreed purchase price must be paid in full before moving in. If you have a mortgage in Spain it will not be possible to move in until the warrant is ready.
The Title Deed
The deed has to be prepared and has to be signed at the notary. Usually it will take about one week to prepare the document until it can be disclosed. So, again, please inform us in due time before leaving your home country for Spain.
Other information that is necessary, is the maiden name of your spouse (if you have got one, of course) and remember to bring the passports with you. Another thing, you should meet at the notary in ordinary trousers, no shorts. Some notaries are very formal and want to have some style around this process. If you don’t do that, the notary may ask you to leave and come back when properly dressed. At the notary you are going to sign the documents for the mortgage and also the Title Deed.
Normally you can pick up a so-called “Nota Simple” the following day, it’s like a preliminary deed. The notary sees to that the original Title Deed is registered in the property register and disclosed. This process may take about six months and the Title Deed may be collected at the notary later on. If you are a member of the Euro-Abogados club, they can collect it for you and give it to you the next time you arrive in Torrevieja.
Shared Ownership - Urbanization Fee
No matter what kind of home you have purchased you are obliged to be a paying member of your mathematical share in the collective ownership in the urbanization (if it is an urbanization). When the property or the urbanization is completed, the constructor is obliged to draft the general assembly. Usually the builder is collaborating with another company or person, an administrator, who is setting up the budget and calculating the fees etc. This will then be presented at the general assembly where it is then possible to make changes.
It will be elected a President amongst the community members together with an administrator for the urbanization, normally the person or company who has invited to the meeting.
The general assembly then decide the final fee that is going to be paid for the collective ownership. The general assembly should be arranged once a year. If you need translation, you yourself have to get an interpreter, but usually there are some persons at the meeting who speak other languages and may assist in translating.
Purchase of furniture
It is several furniture shops in the area and they all have a lot to choose from. They also have complete “packages” of furniture for an apartment or house. Included then are also white goods, lamps etc. and it is reasonably priced.
The furniture can usually be delivered within a few days and the store will bring it to you and install everything for you for free. If you want your new home to b furnished before you are coming to move in, Procon can help you with all this.
If you have a will in your home country you should also add that the property in Spain is included. If you do not have a will in your home country you should definitely set up one in Spain. Inheritance cases in Spain is very complicated and bureaucratic and a will will make this much simpler and easieer to solve for the heirs.
Euro-Abogados can help you setting up a will and the price is about €300,-
Enterprise and Completion
When it comes to enterprise and completion, it is the builder who is in control all the way through. As an agent and broker we have absolutely no influence in this process. The construction activities in the area is enormous and delays according to the completion date in the contract might happen.
Contact us when you are getting closer to the completion date and take over so we can book an alternative stay for you here. It might take a couple of days before you can move into your new home.
In June and July it is quite crowdy and hectic in the area because of the summer holidays in the schools and the town halls are extremely busy preparing all the documents in connection with the enterprise and takeovers. These documents need to be ready for the notary when signing the Title Deed. Euro-Abogados can take care of all this and go to the notary when the final purchase amount are transferred to their client account. When the Title Deed is disclosed varies from case to case.
Normal Time Table for a Takeover
The day of arrival accommodation at the hotel
- 10:00AM meeting in the Procon Offices
- Checking the payments and answering questions
- Meeting with Euro-Abogados, The Membership Club
- Application for the N.I.E.-Number
- Opening of a bank account
- Mortgage documents to be signed in the bank
- 17PM Together we are controlling the apartment or house to see if everything is ok
- 10AM meeting with Euro-Abogados to sign the Title Deed at the Notary and handing out the keys to your new home
- Signing of the electricity and water contracts. This has to be done after the signing of the deed. (Please be aware that we are going to use several hours at the Notary).
If everything is going according to plan, which we cannot guarantee, you can move in, but please calculate some extra days for this.
Some Good Advice along the Road...
It might be difficult to change the way of life from a stressed, hectic and busy lifestyle in your home country where maybe everything is very well organized and functioning after your expectations.
Well, this is Spain, a different culture and history, habits and lifestyle. Here things take time and the Spaniards are not stressing about it. This might be very frustrating for some, to experience the more laid-back and relaxed way of life in southern Europe.
Our best advice to you is, try to be a bit more “Spanish,” enjoy the sun and the beach, eat and drink and relax more, stress down a bit and you will see that everything is falling in place in quite a short time. Things you cannot do anything with is not worth worrying about.
We hope this little guide have cleared things for you and answered many of your questions, and maybe removed some doubts and insecurities about purchasing a second home in sunny Spain.
If you have more questions, of course we will be here to answer them and assist you. Please do not hesitate to in be in touch, we welcome that.
After establishing yourself in your new home both we and Euro-Abogados will still be here for you in many happy and good years to come.
We wish you good luck with your new home and many happy years in Spain.
Warm regards from
IA Procon Torrevieja S.L.