Step by Step Guide to Buying Spanish Property
Purchase and the Law
Once you have chosen your property, you should check its title since there are one or two nasty possibilities. Alternatively your abogado (lawyer) could do this.
- Registration. If you are buying a new property the builder will have to register it at the Ayuntamiento. This should be checked. Alternatively the registration of an older property should be checked against the Registro de Propriedad (property registry). If your intended property has no deeds, one of your first expenses may be to have the deeds drawn up which can be very costly.
- Tax arrears. If the owner has not paid certain taxes, the law allows a charge to be placed on the property. This will be recorded on the title. If you purchase such a property you will become liable for the arrears. The same applies when buying a second-hand car - you would be liable for any outstanding fines, or annual car tax payments which may be outstanding. This system is enforced for any property sale from a motor cycle to a luxury mansion.
- It is perfectly legal in Spain for a builder or property owner to take out a mortgage (hipoteca) on the property you are interested in while you are negotiating its purchase or even after you have done so. If this occurs, you, again, will find yourself liable to repay the loan, as has happened to many unwary buyers.
The Property Register (Registro de Propriedad)
Transfer of property ownership should always be registered though as usual in Spain this does not always occur. If there is any doubt about ownership it is wiser to abandon the purchase than engage in legal battles. However, in normal cases you will find this register useful because it will inform you whether the property has been registered, whether there are arrears of taxes or an outstanding mortgage, whether an agency or company is involved. It can be very complicated in the case of the latter.
The Property Register should be inspected twice. You should check it at the start of the purchase and again at the end just before you register your ownership of the property and complete the purchase.
The Legal Process
Once you have done all this and transferred the purchase money into a Spanish bank in internal pesetas you will be ready to sign the conveyancing document (escritura de compraventa). No conveyance is legal or binding unless it has been signed in the presence of a notary. The notary will want to see a certificate from your bank to confirm that the purchase money has come from abroad and a copy of form TE 13, submitted to the Ministry of Commerce with the details of the purchase, approved with the official stamp.
Please bear in mind that the escritura is the only document which will guarantee your title. Any other kind of deed or contract you may be persuaded to sign will have little effect. Any legal redress may be a very, very long time coming.
Once the conveyance has been signed it should be sent to the Registro de Propriedad to be registered. Once this has been done (and in some areas it may take up to a year) your title becomes final.
The legal process described applies as much to the city as to the country and should be followed through carefully. The Spanish legal system is largely inoperative due to delays of many years and the Tribunal Supreme (Supreme Court) has a backlog of thirty five thousand cases. Local courts may take five or ten years to get round to an average case. If you do not have a local to intervene, you might seriously have to take your life expectancy into account when contemplating legal action.
On the other hand, many thousands of foreigners have bought properties in Spain, followed all the legal processes and have had no problems whatsoever.
