Buying property in Spain is not the same as buying in the UK. There are many differences between Spanish and UK property law and a range of issues to think about, including how the property will be owned, securing a mortgage and notifying the relevant authorities.
To make sure you understand the exact legal requirements you need to meet and avoid the potential pitfalls of buying property in Spain for foreigners, we strongly recommend working with a legal team who have extensive experience navigating Spanish property law.
At Judicare, we have been helping people from the UK to buy property in Spain for many years. We know every issue you need to think about and all of the legal details that need to be taken care of.
As UK-regulated lawyers we can offer the peace of mind of knowing you are in safe hands, while also providing a comprehensive understanding of Spanish property law. We can also offer legal guidance in plain English, so you are never left confused about what is going on or what you need to do.
Whatever your reasons for buying a property in Spain, this may be the first time that you have done so and it could be the first time you have bought property abroad at all. As specialist Overseas property lawyers, we do this every day and have been assisting clients buy property in Spain for many years, so our team know all the tricks and problems that you may come across.
We understand how Spanish law interacts with UK law, so can help to ensure you meet all of the strict requirements of both countries’ laws. Based on our many years of experience, we can offer tried-and-tested practical solutions to any problems you might run into.
As well as guiding you through the process of buying a Spanish property, we can also advice on related issues such as obtaining your NIE, tax considerations, using Powers of Attorney to buy Spanish property and dealing with inheritance issues.
For your convenience, we have put together a list of useful Spanish legal terms and their English translations, to help make navigating legal issues in Spain a little easier. You may also want to take a look at our Buying Property in Spain Checklist.
For specific advice on buying Spanish property tailored to your needs, please get in touch with our friendly, expert Spanish property lawyers based in the UK.
How Judicare can help you with buying a property in Spain
Clear guidance on Spanish property law
The Spanish legal system is very different to that of the UK and our Spanish property team can explain everything you need to consider before making a purchase, so you can move forward with confidence.
We can also advise you on the ways in which Spanish law and UK law interact when buying in Spain, so you can be confident that you are complying with the requirements of both countries’ legal systems.
Conveyancing for Spanish property
Our UK-based Spanish property legal team can handle the entire process of buying in Spain for you, including:
- Reviewing contracts of sale
- Carrying out essential property checks
- Raising any necessary queries with the seller’s lawyers
- Negotiating amendments to the sale contract where required
- Handling transfer of the deposit
- Facilitating payment of the balance
- Making sure the property title is correctly registered in your name
If you wish to make the purchase without leaving the UK, we can create a Power of Attorney giving someone the legal authority to complete the purchase on your behalf.
We can also advise you on having a property survey carried out to highlight any potential defects with the property, including structural issues that could prove expensive to put right. Where any problems are identified, we can negotiate with the seller on your behalf to secure a discount to cover any costs associated with putting right those issues.
We can also assist with negotiation with your estate agent and the offer to secure your overseas property.
Getting a mortgage to buy a property in Spain
Should you need to borrow money to cover the cost of buying in Spain, you have two main options:
- Release equity from your UK assets to buy the property in Spain.
- Get a mortgage on the property in Spain from a Spanish lender.
Each option has advantages and disadvantages but getting it wrong can cost you dearly, so please do take professional advice on this. Our team can advise you on each of these options and the potential long-term consequences of both.
Our recommended international mortgage broker is Simon Conn – overseas mortgage broker - who will be able to assist you with this aspect of your purchase in Spain.
We do not receive a commission for doing so we simply recommend Simon because he has given our clients good service in the past.
Obtaining a mortgage in Spain is more difficult than it has been in the past, but if you are buying a property in Spain that already has a mortgage on it, then it may be possible to take over that mortgage from the current owner.
This latter option may be seen as an easy way of obtaining a mortgage, but you should be aware that the mortgage might have been the right one for the seller but may not be the best one for you.
For more information, please take a look at our guide to mortgages on foreign properties.
Finding a currency dealer for you
When you are converting from one currency to another the difference between one exchange rate and another can literally make a difference of thousands of pounds on your purchase.
Do not underestimate the difference a good exchange rate can make, especially when converting from pounds to euros. We have even seen examples where our clients have sold properties and made more money on the exchange rate difference than they have on the sale of their property.
We are not a bank or currency dealer, but would recommend that you investigate the cheapest way of sending your money abroad. We get approached all the time by currency brokers and have gone through a screening process to make sure our clients get the best service available. Foreign Currency Direct is our company of choice as they regularly beat their competitors and deliver a high quality service.
Foreign Currency Direct have increasingly sophisticated products. You can agree rates for the future. You can get them advising you when to buy or agreeing to buy for you when the rate hits a certain level. You can even agree a fixed rate for longer periods of time if you make regular payments abroad (for example for a mortgage or moving your pension money).
We will normally receive a commission for introducing them to you. This does not cost you anything more as they pay us part of what they make. This commission is costed into our overall charges for providing our services.
Obtaining your NIE (Numero de Identidad de Extranjeros)
Your NIE (Numero de Identidad de Extranjeros) is your Spanish tax identity number (it literally translates as “Foreigner’s Identity Number”). You will need this for paying tax in Spain as well as for various other purposes, including:
- Buying a property
- Opening a bank account
- Dealing with the utility companies
- Taking out insurance
- Dealing with the tax authorities
- Buying or selling shares, bonds and stocks
- Buying a car
The rules on NIEs change regularly and between geographical areas. In some cases, you will be required to obtain your NIE yourself and sometimes it can be done by somebody on your behalf.
We can advise you on the current NIE rules for the area where you are buying and the costs involved, helping to make sure this important step in the process of buying in Spain can be dealt with smoothly and in a timely fashion.
Creating a Power of Attorney for buying a property in Spain
It is common that the title deeds for your property will need to be signed in Spain, which can be inconvenient if you are still based in the UK and would prefer to avoid travelling to Spain just to sign the deeds.
In these situations, we can create a Power of Attorney for you, granting someone you trust the legal authority to sign the title deeds on their behalf.
This approach has several advantages:
- You won’t need to take time out to travel to Spain just to sign the title deeds
- It is normally cheaper to create a Power of Attorney than the cost of travelling to Spain
- You can choose whoever you want to act as your Attorney, including a solicitor, so you can be confident they fully understand all of the legal implications of their role
It is important that you only assign Power of Attorney to somebody that you fully trust as you are giving them the legal authority to act on your behalf.
In Spain, Powers of Attorney tend to offer much broader powers to the Attorney than those afforded to UK Powers of Attorney. It is common for Spanish Powers of Attorney to have very general clauses in them “just in case”. We try to limit the Powers of Attorney as much as possible whilst still allowing the person appointed the freedom to do what is required.
We typically charge £200 plus tax for drafting up a standard Power of Attorney. On top of that you will have Notary fees, foreign and Commonwealth Legalisation fees (£30 per document) and often Courier fees.
For more information, please take a look at our guide to using Powers of Attorney.
Deciding how your Spanish property will be owned
When buying a property in Spain, you need to give careful thought to how the property will be owned. This can have a number of important implications, including for tax purposes and inheritance implications. Getting this wrong could potentially cost you thousands of pounds in tax and other costs that could have been avoided with some smart planning.
There are many options – ranging from personal ownership to company ownership but there is no “one size fits all” solution that works for everybody.
Your circumstances and priorities are different from the next person. We are able to look at your circumstances and your priorities and advise you who should own the property based on that information. The solution may not necessarily be immediately obvious.
When deciding on the best form of ownership we would need to take into consideration both Spanish and UK tax and also a range of other circumstances such as your plans for the property in the future.
We can also advise you on ‘fractional ownership’, where several people are buying a property together. This might be members of your family, friends, work colleagues or even complete strangers. Fractional ownership allows you to buy a share in the property, allowing you to get a holiday home in Spain for less while also sharing the running costs.
You may be familiar with this concept in the form of a ‘timeshare’, but while a timeshare is a type of fractional ownership, there are other options which may be better suited to your needs.
Notifying the relevant people about your Spanish property purchase
There are various organisations, including companies and official bodies you will need contact when you buy a Spanish home, including:
- Residents Association (Comunidad de Propietarios)
- Utility companies
- Land Registry (Registro de la Propiedad)
- Town Hall (Ayuntamiento)
Where required, we can assist with contacting these organisations, helping to make the process as simple and stress-free as possible for you.
Inheritance planning for Spanish property
Spain has different inheritance laws to the UK, so it is generally a good idea to make a Spanish Will in addition to your UK Will.
While you can leave a Spanish property to your chosen beneficiaries in a UK Will, this will normally significantly increase the inheritance costs to your beneficiaries and does not generally make financial sense.
We can advise you on the requirements for making a Spanish Will and help you create a clear, legally robust Will that makes your wishes clear and avoids the potential for inheritance disputes and higher costs for your loved ones in the future.
Our Spanish property legal team can also provide clear guidance on what to do if you have inherited a Spanish property.
What is included in our services for buying property in Spain
We always work on a fixed fee basis so you are able to budget effectively for your purchase from the outset. If your purchase raises substantial or unexpected problems which need to be resolved and require additional work, there may be additional charges. We would inform you before incurring this cost. However, our experience of Spanish property enables us to anticipate most issues so that we can deal with many unexpected problems without any additional charge.
Our services include:
- Legal advice on the terms of your offer to purchase
- Searches at the Town Hall
- Searches at the Land Registry
- Obtaining certificate from the Community of Owners (if appropriate)
- Checking the legal status of the property and the seller’s right to sell
- If appropriate, checking the guarantee provided by the vendor
- Preparing a report on our searches and advising you on the purchase
- Arranging the signature of the title deed
- Arranging payment of the relevant taxes
- Arranging registration of the property at the Land Registry
- General hand holding and advice throughout the transaction