When a UK resident decides to buy property in Spain, hiring a local Spanish property lawyer might seem like the obvious decision. However, this can result in several problems that you may not anticipate – problems which can be avoided by using a UK- based lawyer who specialises in Spanish property sales and purchase.
While there are many reasons for hiring an experienced UK lawyer here are three key issues that can arise if you use a Spanish lawyer.
1. The effects of owning Spanish property on your UK interests
A Spanish lawyer won’t necessarily understand all the implications of owning Spanish property for you back in the UK.
For example, a UK resident purchases a property in Spain and wants to rent it out when it is not in use. They will likely have to pay income tax in Spain, but also declare that on their UK tax returns. UK lawyers experienced in assisting clients buy Spanish property would know this and be able to advise you, accordingly, saving you money and hassle in the long run.
Likewise, if the UK-based owner of a property in Spain passes away, the property will be dealt with under Spanish inheritance laws but will also form part of their overall estate in the UK. Again, an experienced UK lawyer will understand how Spanish and UK inheritance laws interact and the implications for you and your estate.
A Spanish lawyer may not be able to fully advise you on UK tax or inheritance if you are buying or selling your property in Spain.
There are lots of ways that UK laws and Spanish laws interact when UK nationals buy property in Spain and you need somebody who understands both. Without this specialist knowledge you can end up making decisions which might be perfect for a Spanish national but may have negative consequences for you back in the UK.
2. The need for good Professional Indemnity insurance
In the UK, law firms are required by law to have professional indemnity insurance, with the minimum level of cover being £3 million (depending on the type of law firm you go with).
In Spain there is an obligation for the College of Law to provide cover for those lawyers who are registered with it and there is an obligation to register with the Colegio de Abogados. Article 21 of the Code of Conduct of Spanish Lawyers states that they should have adequate cover for Professional Indemnity for the cases that they cover. Therefore, in theory if they are helping with a house purchase, they should, in theory, have insurance to cover the whole cost of the house in the scenario where a mistake is made.
In some instances, however it is worth having in mind that this cover in Spain can be as little as €18,000.
The regulatory body for UK lawyers – the Solicitors Regulation Authority (SRA) – is usually more robust than Colegio de Abogados in Spain, so if something were to go wrong, you are more likely to get a positive outcome if you used an SRA-regulated UK property lawyer.
3. Translating Spanish legal documents into plain English
Foreign lawyers can often speak good English, but is it good enough to explain what is happening where there are complex legal issues to deal with? A literal or Google translation is often not good enough – what you want to know is what something means to you in the UK.
For example, if you were to read a translated contract from Spanish to English, you would still ideally need a UK lawyer to give you the meaning behind the legal Spanish translation and how it can affect your individual legal situation in the UK. Also, some words which can appear on the face of it very similar in one language can mean something very different in another.
Unless you (and your lawyer) fully understand the exact meaning of a word and any nuances of the language, then it is quite easy to be misunderstand the important terms which can have very serious consequences for your purchase.
When talking about legal issues, you cannot afford to have misunderstandings and you need to know what it means to you in the UK. You need a UK lawyer to give you the meaning of the translation and how it affects your personal circumstances.
Why use Judicare Group for buying property in Spain?
Peter Esders is an English solicitor who studied law in both the UK and Spain. He has dealt with the legal systems of many different countries but specialises in Spanish legal issues, particularly in relation to property, probate, litigation and timeshare issues. He is the Deputy Chairman of the Association of International Property Professionals and a member of their disciplinary panel.
To discuss your requirements and how we can help you to safely buy property in Spain, please get in touch