Spanish Properties F.A.Q.

SOME IMPORTANT QUESTIONS ANSWERED

The most common questions we get asked about buying a property in Spain are related to the legal and financial aspects of ownership. It wouldn't be natural if a person were not a little cautious about embarking upon something that is unknown and might contain hidden pitfalls.

Buying a property in Spain is in reality in many ways a lot easier than it is in the UK. The Spanish system is set up to protect both the buyer and seller, providing certain simple steps are taken.

We would however stress that this guide is intended only to help understanding of the processes involved and is no substitute for proper professional legal advice.

English law does not apply in Spain, which makes the Spanish legal system very different from the UK system. We strongly advise people purchasing property in Spain to get legal advice about the property purchase or the signing of legal documents because if they don't, they could find themselves taking unnecessary risks.

Abogado - Spanish Solicitor

Your legal representative Abogado will discuss the many ways of buying a property and advise of the most advantageous method that suits your circumstances. He will also make all the necessary investigations on the property to be purchased (i.e. re-sale).

Once he is satisfied that everything is in order, including finance, it is necessary for the Escritura (title deed) to be signed before a Notary. Your solicitor will advise you when this is ready to be carried out.

The Escritura

The Escritura is the title deed containing a detailed description of the property and proof of ownership. If the property is a re-sale property then the Escritura will also contain the property's recent history and previous details of ownership.

The Notary

The Notary is a public official who places on public record through the title deed the sale and ownership of a property. It must be signed in his presence and must be understood by both parties. When the Escritura is signed in front of the Notary the financial transactions are witnessed and proof of such payments are incorporated into the title deeds of the property.

Power of Attorney

The buyer usually attends the meeting with the Notary in person to complete the transaction, but if this is not possible, arrangements can be made for a power of attorney to be granted. It is usually the Solicitor who is given power of attorney to attend on behalf of the purchaser or vendor.

The Land Registry System in Spain

After the escritura (title deed) has been signed it will be sent to the local land registry office. It will be entered onto the register and the land registry fees will be paid. Your solicitor will make payment of the fees and when the completed deeds are ready he will arrange to have them sent on to you.

A Spanish Will

Once you own a property in Spain, it is essential that you make a Spanish Will if you wish the property to be handed down to your family. Remember English Law has no relevance in Spain. The cost is very small and it is worth considering giving a member of your family an enduring Power of Attorney. This enables your representative to continue dealing with your affairs should you become incapacitated.

Spanish Bank Account

As part of our on going service we will introduce you to a bank once you have signed your purchase contract. You will be required to transfer monies from the UK into your Spanish account in order to complete the purchase. This can be done inoffices in Spain or in the UK before clients depart for a buyer's inspection visit.

You need to provide two forms of identification (passport or a driving licence with photograph will be sufficient) and in the first instance you are not required to place any monies into the account.

However, it is highly recommended that you allow at least five working days for all money transfers to reach your Spanish bank account as delays do occur within the Spanish banking system. If payments are late getting to Spain, this can cause problems with the completion of your purchase.

Applying for a Mortgage in Spain

When applying for a mortgage, the bank will normally ask to see proof of income (for an employed person) - two P60's, six months salary slips and two months bank statements.

Income may be measured on joint income for married couples, so ensure that you also have details of your spouse's income if he/she is working. Proof of identity will also be required (passport or driving licence).

If you are self-employed, then the bank will normally accept two years audited accounts as proof of income plus your last tax statement. Through our special relationship with most Spanish banks, our clients may be able to apply for a mortgage up to 50 - 60% of the properties valuation subject to status. Generally the upper age limit is 75 years of age and repayment periods are usually between 5-20 years.

Investment potential

As an investor you have two main options: Buy to sell and buy to let.

Many investors are already enjoying healthy returns on their investment through buy to sell, as this involves buying property from a development plan during the construction phase. The increase in value is based on the demand for new properties.

There has never been a better time to invest in Spanish property due to the strength of sterling and the over all higher standard of living. Returns in excess of approximately 15-20% have been achieved through this option but please be aware that buy to sell investment returns cannot always be guaranteed.

On the other hand good returns can also be obtained with the buy to let option due to the Costa Blanca being one of the most popular holiday destinations in Europe. It would be a good investment plan to let your property while you are not using it.

This can be done privately or through a letting agency in the area. Further information and rental income projections can be obtained from any member of our advisory staff.

USEFUL TIPS AND INFORMATION WHEN MOVING TO SPAIN

Can I take my car to Spain?

You can take your car to Spain if you have owned it for more than 6 months. The DVLA should be contacted in the UK where you need to apply for a certificate of permanent export. On doing this you will surrender the original registration document. This only applies to non-residents.

If you become a resident and wish to use the car then you will need to re-register the car on Spanish plates.

Can my children be educated in Spain?

The Spanish state education system is of very good standard and is free of charge. Any qualifications obtained are internationally recognised.

Will I be allowed to work in Spain?

Any member of the EU is allowed to work in any EU country.

Can I take my dog or cat with me?

As long as there is proof of all necessary inoculations and relevant microchips, dogs and cats will be allowed into Spain. The next step is to apply for a pet passport that will allow the animals to return to the UK without going into quarantine.

Can I have my state pension and other pensions paid to me in Spain?

The DHSS in Newcastle for State Pensions will provide you with the relevant information on how to do this. You can be paid directly to your Spanish bank account. With private pensions you need to contact your supplier and advise them of your new bank account details. Remember to check if there are any conversion charges and to discuss changing sterling into Euros.

Medical Benefits the pension service

Tyneside Park

Newcastle upon Tyne

NE98 1BA

Telephone 0044 191 218 7547

Is there health care available?

The NHS system in Spain is of a high standard and freely available to retired EU residents. There are various private medical health insurances available and are competitively priced compared to the U.K.

Do I need an identity card if I move to Spain?

Apart from the UK all European countries operate an identity card scheme. You will need to apply at a national police station, which has a foreign department. It is advisable to carry your ID with you at all times as many shops and supermarkets will ask for some form of ID before they will accept your credit card.