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INFORMATION PROVIDED BY THE SELLER OF A SECOND-HAND HOME

- Title deeds
- Property plans
- Occupancy permit, document providing that a property is habitable
- The last paid Property Goods tax bill
- The latest paid community tax bill
- Receipt showing compliance with the increase in land tax value (subsequent to authority transfer)

INFORMATION PROVIDED BY THE SELLER OF A NEW HOME

- Deed of declaration OF NEW CONSTRUCTION
- Occupancy permit
- Certificate of rateable value of the property

THE CONTRACT

Once you've decided on a property, a contract will have to be drafted and you need to make provisions for the deposit. The standard deposit is 10% of the purchase price. The deposit is payable upon signing the contract (Contrato de Compraventa), which will include a completion date and the transaction conditions which usually contains an assurance by the sellers that the property is sold free of charges, tenants and mortgages.

After you have signed and paid your initial deposit on the property, it is imperative to review the important legal details. If you are buying a resale, check the receipt for the paid IBI, the Impuestos sobre Bienes Inmuebles, the annual real estate tax. This receipt gives the all-important Valor Catastral the official assessed value of the property, on which your property owner's income taxes will be based.

Check with the local town hall that the last local Property tax (I.B.I.) bill has been paid, if not, you will be liable for any outstanding balance. All payments to the Proprietors Community are up to date; Authority and Liabilities Certificate showing no problems brought about by non-payment of local Property Tax; Copy of the Statutes which govern the Proprietors Community.

Make sure that your deposit is held in Escrow (a special bank account normally held by a law firm) and that your purchase contract indicates not only the selling price of the property but AA additional charges payable by you.

Make sure that the seller of the property indicates what is to remain in the property at the time of the sale, many properties are sold furnished but you must be made aware of what you are buying with the property and whether the property includes a garage, all of the this must be mentioned in your deposit contract.

Once both parties have signed this contract and the deposit has been paid, you have secured the property. This is a binding contract for both sides with penalties for breaking it or for failing to honour the terms of the contract.

Do not buy Spanish property until you have obtained a current Nota Simple (an extract from the title) from the Registro de la Propiedad.

The Nota Simple shows the latest recorded details of any charges. There are many forms of charges - in Spain debts, charges or court orders are registered against the property rather than the person: these include hipotecas (mortgages), censos (ground rent or leasehold payments), usufructos (interests in the property), limitaciones (restrictions on use), multas (fines), cláusulas resolutorias (determinations, i.e. decisions about the future of the property), or embargos (court orders for distraint or seizure.

PAYMENT AND SIGNING OF DEEDS

The next stage is to complete the purchase at the Notary's office, usually, within a month or so, you will be ready to make the final checks before signing the "Escritura Publica de Compraventa" (title deed) in the presence of a Spanish Notario (Notary) who certifies that the contract is officially made, the notary does not certify that all statements are true, only that the parties have sworn to them. There you will be required to pay the balance of the purchase money, taxes and Notary's fees.

NOTARY CHARGES

The Notary for preparing the deed collects these and presiding over it's signing. His fee is fixed by law, is on a set scale according to the property value, and whether the property is mortgaged or not, is not normally more then 1% of the purchase price including VAT.

Please note all professional fees including the notary's and land registry's charges are subject to 16% VAT.

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