Buying a Property in Costa Brava
You don't have to be a resident of Spain nor do you require any special paperwork to buy a property in Costa Brava. The purchase procedure is both simple and straightforward with your agent handling much of the legwork on your behalf, such as assisting with opening a Spanish bank account, obtaining a NIF number and finding local mortgage suppliers and legal advisors.
Allow 10% for costs and fees
When buying property in any region of Spain always budget for an additional 10% above and beyond the asking price in order to cover the following items:
- Stamp Duty - 8%
- Land Registry Fee
- Notary Fee
- Mortgage Arrangement Fees
- Lawyers Fee
Secure a mortgage
Once you have opened a non-residents bank account you can apply for a mortgage loan from a local bank.
Non-residents can apply for mortgages of up to 70% of the value of the property they wish to purchase. Local banks will require the following paperwork:
- Payslips/payroll (3 previous months)
- Passport photocopy (for all named applicants)
- Proof of other income/assets
Self-employed buyers will need to provide the following additional paperwork:
- Statement of accounts (last two years)
- Proof of tax payments (last two years)
Local banks may also ask to carry out a credit check on applicants in their country of residence - a procedure that has become fairly standard over the last couple of years.
Get your property valued
The bank that you have applied for your mortgage with will then carry out a valuation on your chosen property. As in most other countries in the EU they will then offer to lend funds against this valuation - and not the purchase price. The buyer usually pays a fee of from €300 upwards for this service.
Sign the 'Option to Buy' contract and pay a 10% deposit
Once your property has been valued and a mortgage offer has been made you will then be required to sign an Option to Buy contract. This outlines key details of the deal, such as price and also a timescale for completion.
This contract is then sealed by the payment of a 10% deposit by the buyer. An excellent device which basically prevents gazumping and removes uncertainty from the purchase procedure. If the vendor should decide to withdraw from the agreed deal he then becomes automatically liable to refund the 10% deposit plus a further additional payment of 10%.
By the same token, should the purchaser withdraw from the deal after this contract is signed then they will also forefeit their 10% deposit.
A purchase contract will then be drawn up, outlining all of the information relevant to your purchase, such as the agreed price and a timescale for completion (usually 4-6 weeks from signing).
Transfer funds and complete the purchase
The next stage is to ensure that the funds are in place in your Spanish bank account to complete the purchase.
Final completion of the deal will then take place at a Notary Office, in Spanish and under the supervision of your estate agent, who will also arrange the services of an interpreter for the reading of the deeds.
Your purchase is sealed by signing the deeds and paying the balance of the purchase price along with the notaries fees and other ancillary costs.