property plus edition 3

Edition 3

PROPERTIES OF THE MONTH

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LegalServices

FM SpanishPromotions

2 Friday, March 15, 2013

3Friday, March 15, 2013


A STEP BY STEP GUIDETO YOUR DREAM HOMEBuying property can bring all manner ofemotions and experiences, from excitementto sheer exhaustion. So it is a good idea tosurround yourself with professionals whocan take up some of the strain.

From the moment that you decide to pur-chase a property in Spain, you are well advisedto employ a Spanish speaking Solicitor who willact on your behalf. Do not be tempted to cutcorners to keep costs down, because when youweigh up the global investment and conse-quences which you could face later on if you donot do it right, it will be well worth it. The firstthing that they will do is check the property’saddress for any unpaid debts or embargoeslodged with the Land Registry at the Town Hall,as if you proceed with a purchase you stand toinherit any prior charges that go with it. Asidefrom this, registry should have a record of anybuilding permits and planning permissionswhich have been granted, whilst newly con-structed buildings must have an official“Certificate of New Work” (Obra Nueva) and “Cédula deHabitabilidad” which is the Certificate of First Occupancy.Finally, the Solicitor will be able to confirm that the propertydoes actually belong to the vendor alone, and that they havethe legal authority to sell it without seeking authorizationfrom a third party.

ContractThe Purchase Contract, or “Contrato de Compra-Venta” is

the legal agreement between the buyer and seller, andstates all terms and conditions relating to the purchase.These should always include:

• The agreed purchase price• Details of any deposit paid• The Intended completion date, although this can be

amended if any hiccups occur along the way, so long as bothparties are in agreement.

The contract will also state any other terms which are spe-cific to your personal purchase agreement. As soon as yousign on the dotted line, you will be expected to pay thedeposit, which is usually pegged around 10% of the pur-chase price. Occasionally, a back-out clause known as an“arras” is worked into the contract, allowing either party towithdraw from the agreement under certain conditions. Oncethe contract is secured all documentation relating to theproperty, buyer and vendor are compiled and sent to thelocal Notary, (El Notario), who will prepare the legal docu-ments, conveyance and conduct their own searches on theproperty. At this stage you should have a clear plan of howyou intend to pay the outstanding value for the house, eitherusing cash or having secured a mortgage.

Off-PlanYou will follow a similar process if buying

“Off-Plan”, although payment for property isusually made in stages rather than a lump sumexchange. In most cases, the buyer will pay adeposit and sign the contract to secure the plotin the first instance before making additionalpayments at various stages of the constructionprocess. In this sense, the contract should setout a very strict timetable for the stage pay-ment dates, the completion date, including anypenalties to be applied for non-completion,guarantees for building work and full details ofthe builder's insurance policy. It is wise toremember that although you may havepledged a considerable amount of money tothe property, it still remains under full owner-ship by the Constructor until contracts areexchanged before the Notary. The staged pay-ment process is a little more complicated whenapplying for a mortgage, although Spanish

banks are quite accustomed to the Off- Plan paymentscheme, so will usually be able to arrange a bridging loan tocover interim fees, in addition to the final sum.

CompletionWhen all financial and legal mechanisms are in place, i’s

dotted and t’s crossed, all there is left to do is sign the deedof sale. This is a very formal event which takes place in theNotary’s Office. Prior to signing, the Notary will look over thecontract to ensure that it is complete, before signatures arewitnessed and monies exchanged. Once the deed is signed,the buyers name will be printed on the cover of the originalcopy, which is then lodged at the property registry office bythe Notary to be used for Municipal records.

And you walk away with the keys to your new casa!


Why YOU shouldbe on the Padrón

By Heidi Wardman

There has been wide-spread confusion inthe past, concerning who should registeron the Municipal Padrón, and what thebenefits are. Therefore, we have com-piled a brief outline to give you a betteridea.

If you are a permanent resident in Spainyou are legally obliged to register on theMunicipal Padrón at your local town hall,regardless of nationality. The “padrón” is thelist of names and addresses of all of the peo-ple living in a given town; similar to theElectoral Roll in the UK; and the term“empadronarse” describes the act of regis-tering on the list. However, in spite of thisbeing part of Spanish law, there are manypeople, including British expats, who fail tofollow this protocol. It is not really under-stood why they are not keen to make theirpresence known to the Spanish authorities,as the majority have no qualms over follow-ing similar procedures in their hometowns.Perhaps they feel that they are putting them-selves under a spotlight and vulnerable toharassment by the authorities if they givetheir details to the town hall? However, this isfar from the truth, as the idea of the registeris merely to monitor how many people areliving in each area for demographic purpos-es, and predominantly to ensure that the cor-rect level of funding is allocated to the provi-sion of public services. The authorities stressthat padrón registration does not giveaccess to a person’s financial affairs and isnot used as a sneaky way of checking theirofficial residence status.

Who can register on the padrón?

Anyone who has a fixed address can reg-ister on the padrón, even if they do not owna property personally, and are only renting orlodging with friends or family somewhere.Plus, in comparison to obtaining NIE num-bers and residence certificates, registrationis a relatively simple process and completelyfree of charge! Most town halls these daysare equipped with their own padrón office ordepartment, which is accustomed to com-pleting the process, as well as dealing withforeigners who do not speak the lingo! TheAdministrators will ask you to complete an

application form, submitting this accompa-nied by a photocopy of some form of identi-fication, such as a passport, along with yourNIE document or residence certificate/card,a recent utility bill in your name which bearsyour current address, and either the deedsto your house or a copy of your rental con-tract. In busier offices you may be requestedto return the following day to collect the actu-al certificate, whilst in others it is producedthere and then.

So what are the benefits ofregistering on the padrón?

As mentioned previously, the padrónenables the Local Government to gage howmany people are living in the town, and soapply for an adequate amount of fundingfrom the Central Government to cover publicservice provision. This means that if peoplefail to join the register the town hall does notreceive the money to cover the provision ofhealth centres, police officers, fire fightersand schools for the entire population. Asidefrom this, you must have been registered onthe padrón for a given period of time in orderto qualify for some of the income dependentsocial care and welfare benefits available viathe local Social Services Department.Registration on the padrón in certain munic-ipalities can result in a reduction of variouscommunity charges and inheritance tax.

As an official resident of your town, youwill be entitled to a variety of discounts onevents organised by the town hall, such aslearning and development courses, leisureand cultural activities; whilst by showing acurrent “Certificado de Empadronamiento”residents can become eligible for discountsof up to 50% on air fares and ferry ticketsbetween the mainland and Spanish islands.There are a variety of essential administra-tive tasks which can only be completed onproduction of a padrón, such as applying fora SIP health card, vehicle registration andenrolling your child at the nearest school toyour home. Finally, padrón registration willgive you more of a say in who is running theshow in your town, by enabling you to vote inlocal and European elections.

Essentially, taking the small step of regis-tering on the padrón will make your life inSpain a hundred times easier in the long-run, and is well-worth the paper its writtenon!

property plus edition 3

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