When you purchase a property in Spain, you will find that the buying process differently than in Belgium and the Netherlands. For example, clients find it strange that in Spain payment is still made with a bank cheque. Therefore, this article will take a closer look at how to pay for the purchase of a property in Spain.
In a resale, payment is usually made in three steps.
The first payment: the reservation amount
As soon as you decide to buy a Spanish property, the estate agent will ask you to sign a reservation contract. This prevents the seller or the estate agent from offering the property to other interested parties for a certain period of time. Upon signing this reservation contract, you will also pay a reservation amount to the estate agent. This amount varies between €1,500 and €10,000, depending on the purchase price. However, you can take 1% of the purchase price as a starting point.
An example: you decide to buy a €150,000 property in the Alicante region. The reservation amount is then 1,500 euros.
Read more about the reservation contract and the reservation fee.
The second payment: 10% of the purchase price
Within reservation period, you have the opportunity to comply with a number of formalities, such as applying for a NIE number and opening a Spanish bank account. The legal condition of the property should also be investigated.
Once the above points are in order, you can sign the compromise. Unlike the reservation contract, the compromise is a binding purchase agreement. Upon signing the compromise, 10% of the purchase price is paid to the seller, less reservation amount. So in the example just given, that is 10% of €150,000 = €15,000, minus the €1,500 already paid = €13,500.
Read more about why it is best not to sign the compromise immediately.
The third payment: the remaining sum
The final payment to the seller is usually made by handing over a bank cheque. In Belgium and the Netherlands, the notary is responsible for the legal completion of the purchase transaction, including the receipt of payments. In Spain, however, the notary is not responsible for receiving the payments.
Read more about the notary's duties in Spain.
Therefore, handing over the bank cheque to the seller at the time of signing the notarial deed is the only method of payment that provides security. If you make a bank transfer to the seller before signing the notarial deed, you have no guarantees that the seller will appear before the notary.
Read more about opening a Spanish bank account and the bank cheque.
Payment of other costs
Finally, there are other costs besides the purchase price. These include registration fees, notary's fees, registering the new titles in the land register, transferring utilities, etc. You pay these costs separately to the respective recipients via bank transfer.
Read more about additional costs.
Update February 2021
