Safely Purchasing a House in Spain

  • by ISREproperty
  • 7 months ago
  • 1
ISREproperty

Together with the Association of Spanish Property and Commercial Registrars, the
Ministry of Public Works, Transport and Housing has drawn up a brief, simple guide
outlining the different steps and recommendations that a private purchaser should
follow when buying a house in Spain.
It contains very useful information, is free of charge and is available to any Spanish or
foreign purchaser. It aims to help such purchasers make informed decisions.
Within the Spanish legal system there are a series of documents that certify that a
house is completely legal. Make sure that you have all of them before purchasing a
property. These are:
 A construction permit and certificate from a competent expert verifying that the
building matches both the license granted by the town council and the project it
approved.
 A first occupancy license, a habitability certificate and other administrative
authorizations that establish that the dwelling is legally habitable.
 Documents signed by the utilities supplying the essential services (electricity,
water, gas and telephone).
 The entry of the building in the Property Register (new buildings), together with
insurance cover against hidden defects or flaws in the construction, as
established by law.
 A Property Registration Certificate setting forth the legal situation of the
building.
 The Owners Association Statutes (or inscription in the Property Register of the
deeds of any new, finished and horizontally-divided building).

We also recommend:
 In the case of new constructions, for buyers to ask the developer for: a
Certificate from the Commercial Registry accrediting the legal existence of the
company, details of its registration, the administrators and/or their
representatives, the company’s registered office, its fiscal identity number,
confirmation that bankruptcy proceedings have not been registered, and a
declaration that there are no claims, lawsuits or any other contingencies that
might affect the development.
 In the case of housing that is not newly built, ask for last year’s property tax
receipt, a certificate signed by the president of the Owners Association and
endorsed by the building’s secretary stating that the property you are buying is
up-to-date with all payments, as well as a formal confirmation and a public
document stating that the property is not subject to any rental contracts.
When buying your property, there are a series of steps which will enable you to make
your purchase with full guarantees:
1. Check the legal position of the property by contacting the Property
Registry
The Property Registry is a state body and the Registrars are civil servants who
provide you with verbal information free of charge and who have the power to issue
certificates concerning the legal position of the property.
In the Property Registry you can obtain the following information regarding
each dwelling:
A description of the property, its position, surface area, the amount under
common ownership in an apartment property, the administrative system that
may affect it (e.g. whether it is subsidized housing); any existing mortgages on
the property, when they are due to expire and capital, interest and costs; any
embargoes to which the property is subject; any litigation that may affect it, and
whether proceedings are under way for urban planning irregularities. You can
also obtain information, if you explicitly request it, regarding the statutory
system for apartment properties, the mortgage clauses, the price paid in
previous ownership transfers and the title deeds.

The Property Registry can provide you with this information in the form of a
simple informative note, or in the form of an ownership and liabilities
certificate, which is an official public document. In addition, you can also
ask the Registry to issue an explanatory report describing the registration
position of the property.
In Spain, any Property Registry can provide you with these documents,
irrespective of the municipality in which the property is situated. Furthermore, you
can request this information by fax, post or email and via the website of the
Association of Property Registrars at www.registradores.org.
To obtain these certificates, you will be asked to identify yourself and to
provide some type of document which will make it possible to identify the
property for which you are requesting information, such as registration details
(the registered property number, the section, the municipality), or details of the
owner (name, surnames, corporate name, fiscal identification number/fiscal
identification code), or other simple data such as the street and house number.
2. Study the existing mortgage charges
In addition to the legal requirements, it is important to pay attention to whether the
property you are going to acquire has a mortgage (if this is the case, it will appear in
the Property Register). If so, we recommend that you:
Ask the vendor for a bank certificate with the outstanding amount to be
paid.

Negotiate a better interest rate with the bank. You are not obliged to assume the
mortgage loan contracted by the vendor under the same conditions; rather you
may demand its cancellation or obtain a new loan with another institution.
3. Go to a notary to carry out the purchase and sale
Notaries are also independent public officers who have the authority to attest
documents and who are obliged to counsel parties at the time of the sale, informing
them about the law that applies to them. Furthermore, they are in charge of drawing
up the contract in accordance with the parties’ wishes and adjusting it to the law. The
contract takes the form of a public deed

The public deed is essential in order to register the sale in the Property
Register and to benefit from the security it gives you, as explained in point 5.
Before he or she authorizes the sale, the Notary shall request a non-certified
extract from the Property Register. You may therefore review the legal status of
the property again at this point.
If you have any doubts, ask the Notary before you sign, it is his or her role to
advise you.
The sales contract may have been previously formalized by both parties in a private
document, but that document shall not contain all the legal guarantees if it is not
converted into a public deed.
In Spain, the Notary acts at the time of the sale, but he or she may also advise you in
advance, just as lawyers and agents do in your country of origin.
4. Make sure you pay the corresponding sales taxes
Purchasing and selling property in Spain implies payment of certain taxes:
When buying a new property, you must pay VAT to the vendor.
When buying a used property, you must pay the Tax on Capital Transfers
through one of the banks recognized by the Government.
In both cases, if you buy via a mortgage you must pay the Tax on
Documented Legal Acts to a Tax Authority account through the collaborating
banks.
5. Register as owner of the property in the Property Register
Once the sale has been carried out and the taxes have been paid, go to the Property
Register corresponding to the property’s location to register it. Registration is not an
obligation, but if a purchaser does so he or she shall be fully protected as the
proprietor:
What appears in the Register is presumed to be true and can only be
modified by a judge.
Nobody may dispute your right regarding the property that has still not
appeared in the Register at the time of carrying out the sale and if someone
wishes to register a document he or she may only do so with your consent or by
legal procedure to which he or she has been party.
You shall be protected against the vendor’s creditors and against any charges
that may occur which have not been entered in the Register.
You shall be protected even if a judge were to decide that the contract through
which the person who sold you the property originally acquired it is void, for
reasons that do not appear in the Register.
Furthermore, you must understand that according to Spanish law the vendor is
responsible for hidden defects at the time the property is sold or which may
occur subsequently, even when he or she was unaware of them. This means that:
If the property does not comply with the quality objectives in the habitable
indoor space as stipulated in current legislation, the purchaser has the right
to either waive the sale (paying the vendor the costs he or she has incurred)
or to a reduction in the price, duly established by official experts.
You may enforce liability on the building’s developer and the builder and the
technical supervisor for structural construction defects that may occur during a
period of 10 years; for damages that may affect the building’s habitability for a
period of 3 years; and for damages caused in finishing defects for a period of 1
year.
Spanish Law requires those persons who may be liable to have insurance
coverage which guarantees that you may recover indemnity without any
problem, should this be the case.

Source:

https://www.mitma.gob.es/

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