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Once you have chosen your property Bargain Homes Abroad will introduce you
to a reputable firm of English speaking lawyers. They will
oversee your transaction from start to finish, ensuring
that all your questions and concerns are answered.
In anticipation of your questions Bargain Homes Abroad have provided some
legal information for your interest.
POINT 1
Prior to the completion of your purchase the property has
to be checked to ensure that there are no outstanding debts
attached to it, this is to ensure you do not inherit any
debts upon completion. If the property is subsequently found
to be carrying any debt, the solicitor will retain that
portion of the monies payable upon completion to ensure
that debt will be settled in full.
The solicitor will also take copies of the previous owners'
domestic bills to ensure they have been paid up to date.
The same follows if you decide to buy a new property. All
the same precautions are taken to ensure there are no problems
for the purchaser in the future.
POINT 2
When you are ready to complete the purchase it will be necessary
for you to present your purchase application before the
public notary. The role of this person is to ensure that
the purchase you are about to make is lawful and meets certain
criteria laid down by the Spanish government. They will
check the new property deeds (Escritura) to ensure that
all parties are represented correctly and that the ownership
will pass to the buyer upon completion either solely or
in conjunction with a mortgage.
It is normal that your solicitor is there to represent you
and translate any documents that you will need to sign.
It will also be necessary for a bank representative to be
present, should you be taking a Spanish mortgage against
your property.
POINT 3
In the period between paying your deposit and the presentation
before the public notary, the solicitor will make a number
of different checks to ensure that everything will complete
to the satisfaction of the notary on your completion day.
POINT 4
In respect of your house purchase Bargain Homes Abroad have taken the liberty
of indicating the estimated costs associated with your transaction.
They are as follows:
Cost for Public Notary £200 - £300
Cost of registering your property £200 +
Financial search on property £150 +
Spanish Transfer Tax 7% of officially declared value
Stamp duty: New Houses 1% / Resale Properties 0.5%
POINT 5
The costs associated for the services provided by the solicitor
are comprehensive and as follows:
Domestic contract changes
I.e. Gas, water, electricity, rates etc
Legal representation before the public
Notary and translation of all documents
Production of official NIE numbers
( Passport photographs required )
Production of mirrored wills
Fiscal representation for 1 year
Total cost for these services is £700
Bargain Homes Abroad estimate that you should normally need to allow 10% of
your purchase price to cover your associated costs or 12%
if you are purchasing your property using a mortgage. This
additional cost when buying a property using a mortgage
is due to the replication of deeds and registration the
mortgage valuation and application costs.
POINT 6
If you are making a resale purchase, the owner of that property
is liable to pay capital gains tax on the appreciation of
that property from the time it is acquired. If the owner
is a non resident in Spain then the purchase price is paid
to the owner less 5% to ensure that they pay their capital
gains tax. Once their exact liability has been calculated
the tax office will return any monies due to the owner.
This will normally take approximately 6 months. If you are
purchasing from a Spanish resident then this situation does
not apply and all monies due upon completion will be paid
to the owner.
Your liability to capital gains tax also varies depending
upon your status in Spain. If you are non-resident, your
liability is normally 35% of the OFFICIAL gain you have
made during your ownership ( i.e. The value declared on
the title deeds ) less any substantiated costs associated
with the properties improvement or legal representation.
If you are a resident in Spain your liability is fixed at
25% of the official gain. These liabilities will be examined
in greater detail when you wish to sell your property as
there are some other allowances that can reduce your liability
further still.
POINT 7
When you purchase a property here in Spain as a non resident,
you will be charged a tax on an annual basis known as the
WEALTH TAX. This tax assumes that as a non resident you
will let your property out for rental purposes.
This tax is calculated at 0.5% of the official rated value.
For example if the official value of your property was £75,000
you would pay £375 per annum. This is all calculated
and handled for you by the solicitor within their fiscal
representation on your behalf.
The above information is intended as a guide only and should
never be used as a substitute for professional legal advice.
Bargain Homes Abroad assumes no responsibility for the
accuracy of the above information. |
