Contracts for a Spanish property

Which contracts do I need to sign?

When purchasing a Spanish property, you are required to sign various contracts. What is the difference between all the contracts? What conditions must they meet? Read all contracts carefully before signing. For example, reserving a property subject to financing is not common in Spain! Are you not fluent in the language and unable to understand the contracts? Then it is advisable to hire a lawyer or a gestor.

Reservation Agreement

Have you found a home that meets your requirements? Then you might consider signing a reservation contract, also known as a 'Contrato de Reserva'. Upon signing this contract, the seller is obliged not to offer the property for sale publicly anymore. It is customary to make a down payment with this reservation contract. An estimated amount for this is between €3,000 and €6,000. This reservation fee is deducted from the purchase price upon the transfer of the property. Please bear in mind that the property could still be sold to someone else!

Earnest Money Contract

You sign this document (following any reservation contract) to confirm your serious interest. A contrato de ARRAS is also known as a preliminary purchase agreement.

Deed of Sale

The final purchase contract, escritura de compraventa, is signed during the transfer of the property at the notary. This is also the moment when the property is handed over to the buyer and the (remaining) payment is made to the seller.

What about other documentation?

Before signing the contracts mentioned above, it is advisable to thoroughly inspect the property. Is a Cedula (residential permit) present? Is the property legally registered? Is the Nota Simple in order?

These are important things to know about the type of property you are buying. If the property has defects, the Spanish bank may well refuse to provide financing. Unfortunately, these kinds of situations are not uncommon in Spain. Therefore, always ensure you are well informed!