When you have found the ideal property to suit your needs on the Costa del Sol and have decided that you wish to move forward with the purchase, the next step would be then for Optimum Real Estate to present you with a “Reservation Contract.” A reservation contract is used in Spain as a standard procedure to reserve a property for a specified period of time whilst your lawyer (or our recommended trusted lawyer) conducts due diligence.
A reservation contracts purpose is to set basic terms and conditions of the purchase which would then be approved and signed by both the buyer and the vendor. This is a only a temporary reservation document whilst due diligence is conducted by your lawyer.
This contract would include:
- Full name of buyer and vendor.
- Price of the property.
- Property address.
- Date to sign a “private purchase contract.”
- Other special conditions (subject to finance.)
- Deposit amount placed to reserve the property ( 6000 Euros. )
The deposit will secure the property while the “due diligence” is being conducted. This deposit can be paid by credit card, bank transfer or in cash, it can be held with our lawyer or a lawyer of your choice. The 6,000 Euros is to reserve the property whilst your chosen lawyer conducts the due diligence and you may also want to arrange a mortgage during this time with our recommended bank or a bank of your choice. This reservation deposit is fully refundable in the event that your lawyer should discover any legal impediments pertaining to the said property. Should you continue with your purchase after the due diligence the 6,000 Euros will be used towards the purchase price.
To continue with the purchase the next step is then to move onto a private purchase contract after you’re or our lawyer has conducted all due diligence. The contract will be prepared by your lawyer and will contain:
- A legal declaration from the vendor that he or she is legally able to sell the property.
- The address and dimensions of the property and its features as set out in the “Referencia Catastral” Government registration of the property.
- The completion date and hand over of the keys etc.
- The agreed terms and conditions as agreed by the consumer and the vendor.
The buying costs in Spain vary from 10% to 13.5% of the purchase price, broken down as follows:
- 10% IVA (VAT) on NEW properties, 8% to 10% IVA (VAT) on re-sales depending on price category
- 1% Notary fee ( Notarization of property cost)
- 1% Legal fees ( a fee charged by your selected lawyer to conduct the * Due diligence
- 1.5% Stamp Duty Tax ( A tax charged to make all documents legally effective)
If you have any further questions or enquiries please contact us directly.