The Buying Procedure explained - 6 steps!
Once you have decided on property the to buy and you have agreed on a price with the seller Lexington Realty will help you through these 6 steps!
1Initial check of the property
The Nota Simple or “Land Registry Local Search” will confirm that a property is debt free, the ownership of the property, and the property description so they can be compared to what the buyer has been informed. Lexington Realty will obtain this document before any down payment is made to ensure it is correct for your security.
2Financing the property with a mortgage
If you are buying an existing property in Spain, with mortgage this is what is going take the most time. The Spanish bank or your bank at home will ask for a number of documents. Those that have to do with the property Lexington Realty will provide. The bank will then pre-approve you, and you can safely sign the pre-agreement and pay the downpayment.
3The pre-sales contract
Until the signing of the public deed it is normal to sign a simple document with the seller in which the seller expresses their intent to transfer the property to the buyer, and the buyer expresses their intent to buy at the price and conditions agreed upon. A reservation deposit is paid ranging from 5 to 10%. The typical agreement in Spain (called”contrato de arras) is if the buyer backs out of the contract, they loose the deposit; if the seller backs out, they have to pay double. As this is a private contract, the buyer and seller may agree on anything that they ﬁnd reasonable.
4A few practical things before the purchase
If you do not already have an NIE number (a Spanish identification number) which is required for opening a bank account and purchasing a property, then Lexington Realty can organise this. We can also help you open a Spanish bank account which will be necessary for transferring the funds to purchase the property and paying the bills afterwards.
5The actual mortgage
Once the bank has a copy of the pre-agreement, they will send an appraiser (tasador) to value the property. The bank requires an appraiser to ensure that their loan to you is safe. The bank will only give you a loan equal to a determined percentage of the appraised value of the house the costs are between 300-500 euros.
6Signature and closing
Lexington Realty after sales service will make sure that the taxes are paid, that the utility contracts are transferred into your name, set up the relevant direct debits, and finally register your property with the land registry office into your name. Read more about the taxes and costs involved.