Expenses when buying a property in Spain, part 1Елена Шляпникова
When making a decision as important as buying a property in Spain, you must be very conscious about other expenses that will involve this purchase. Since it is not only the cost of the chosen property, but also a mortgage, if you have any, the expenses associated with the purchase and its official registration. In this article, we will explain the most important of them.
Expenses before signing the acquisition contract
When applying for a mortgage, after signing the deposit agreement, a bank or financial institution must make an official appraisal of the property, a house or an apartment in Barcelona or Spain, to determine the correct relationship between its selling price and its real value. This procedure has a price of approximately 100-400 euros, depending on the type of property and its square meters, and is a prerequisite for the financial institution to accept your application for a mortgage in Spain.
Earnest money contract
Before signing the deed of purchase of a property in Spain, a preliminary agreement is usually signed between the seller and the buyer. This document is private, is called contract of arras and is written by a competent lawyer. The signature of this document guarantees the signature of the deed, since it details the conditions of necessary fulfillment for both parties. In addition, these conditions are always within the current legislation, so an attorney with experience in Barcelona must prepare the earnest money contract. Although its signature is not necessary, it is a very common practice for the registration of the real estate transaction, as it will help you avoid many problems in the future.
Spanish legislation recognizes this private document as official and with full legal validity, which means that the signing of this document legally obliges you and the seller of the property to comply all its clauses, if they are not contrary to applicable law. Therefore, it is especially important that you consult a professional before signing it and entrust its preparation to a competent lawyer in Barcelona.
This deposit contract must include the final price of the object, i.e. a residential property in Barcelona. In addition, it indicates how the agreed price will be paid: in full at the time of signing the deed or in deferred quotas (in whole or in part), as well as the method and date of payment of the deferred parts. In general, the preliminary contract also stipulates the deposit that is paid by the buyer to the seller at the moment of its signing and which is deducted from the final price. According to professional practice, the most common are the following cases: the buyer loses the deposit, if the signature of the deed does not take place because of him or if he decides not to buy this property in Spain. In addition, if the deed is not signed because of the seller, then he has to return the deposit to the buyer in duplicate.
To be continued in “Expenses when buying a property in Spain, part 2”.