Legal Advice

You have found your dream home in Valencia, so what happens next?

When it comes to buying or selling a property, we are often asked whether it is really necessary to hire a lawyer. You may probably think, trying to be cost effective: “The notary checks everything, right? If that is the case, then why do we need a lawyer?”

Let us get you out of the nightmare right away. Because having a lawyer is indispensable in Spain when buying a property.

We are happy to tell you why!

Legal Advice
Legal Advice Valencia

Notary Vs. Lawyer

Where the role of a notary in most Northern European countries is the most important key figure in the purchase of a property, this is slightly different here in Spain.

Naturally, the notary is important in the smooth completion of the closing process and checking the final notarial deed of sale (the ‘escritura’). But the lawyer is the one who has actually done all the legal work.

The lawyer at the end is the most important person during the purchasing process. With this information we want to give you some insight into the role of a lawyer, what he or she does exactly, when you call for help and also their fees.

A Practical Example

You have been on a viewing and have found your dream property in Spain. Congratulations! Now what? Since the house is probably not for sale exclusively with one real estate agent, it is important to get the house off-market as soon as possible.

Where normally you can expect that all checks have already been done in advance before a property comes on the market, this will often still have to be done to a large extent due to the non-exclusivity principle. That means that before a preliminary purchase contract is drawn up and 10% of the purchase price is paid, it is very important that you know for sure that everything is correct.

For this purpose the reservation contract has been devised, the ‘contrato de reserva’. In this way you can take the property off the market, but under the conditions of a proper legal check. With this contract and a deposit of usually between €3000 and €6000 you buy time.

Once this reservation contract is signed and the reservation deposit has been received, the property will go off the market. It may no longer be offered and viewed by others. The money remains secured with the broker and will be refunded if the legal checks eventually show that this is not a good property to buy in legal point of view. And otherwise it is already applied towards the 10% down payment of the purchase price.

Legal Advice - Example
reservation contract

At what point do you need Legal Advice?

This reservation is in any case the moment when we will advise you to contact a lawyer. The validity of a reservation contract is not unlimited. Under normal circumstances it is assumed that all checks will have taken place within 7 to 10 days. So within two weeks this should lead to a preliminary purchase contract.

Once you have given the assignment to your lawyer, they will request all relevant documents from the selling party as soon as possible. After making the reservation, it is important in Spain that a lawyer will check various matters for you before proceeding with the provisional purchase contract (contrato de arras) and the 10% deposit. After all, you don’t want to buy a property that turns out to be incorrect afterwards.

If your lawyer discovers a reason why you should not buy, you will be protected from a major mistake and you will simply get the reservation amount back.

What does a Lawyer actually do?

You can assume that most lawyers do the same checks but it is worthwhile asking what exactly is included in their purchase assistance. The tasks of a good lawyer in Spain include the following:

A lawyer not only checks, but also knows how to resolve any legal challenges. For example, it regularly happens that there are deviations in m² between the cadastre and the register. Not all outbuildings or swimming pools are always described either. Often the lawyer can check whether this can still be realised and ensure that this is legally rectified before or during the completion.

Your lawyer can also request the zoning plan for a property on request. It can be used, among other things, to determine whether the house could possibly qualify for a rental license. If you want to rent it out, the lawyer is the one who will ultimately give you a definite answer about the possibilities in the specific municipality. A rental license can never be guaranteed for research into the rental possibilities of a lawyer.

After the completion, your lawyer can also change the contracts with the utility companies (gas, water and electricity) for you. These will then be debited from your account via an automatic payment. So you don’t have to arrange anything yourself.

What a lawyer does
Power of Attorney

Do I have to be present all the time?

A lawyer can do much of the work remotely and online. You can be present yourself for a number of matters, such as the completion at the notary. If that is not possible in any way, you can also give your lawyer a power of attorney via a notarial authorization. The lawyer will then be able to sign for you if you cannot be present in Spain.

For example, if you are in the process of realising your own custom newly built dream property in Spain, you will often have to be in Spain to sign various documents. This includes building permits or securing the payments made by receiving a bank guarantee. Your lawyer can do this for you via the power of attorney and you do not have to come to Spain for every signature.

In addition to the standard tasks and providing independent advice, your lawyer in Spain can also arrange a number of other matters for you. With a Power of Attorney (issued at the notary), your lawyer can arrange matters for you or sign for you if you cannot be present in Spain yourself. For example, a lawyer with a power of attorney can also apply for an NIE number for you if you have not yet done this yourself during the preparation process. In Spain you need the NIE number (the tax number for foreigners) when buying a property.

In that case, keep in mind that the NIE number is a lot more expensive than if you do this yourself, via the normal way. Where a NIE number normally costs about €10 administration fee, this amount quickly comes to about €300 per number through a lawyer. But it is nice that your lawyer can arrange this for you in Spain if you have found your dream property and want to proceed.

Of course we always recommend that you be present yourself as much as possible. After all, you are the one who is going to buy a property in Spain!

How do I find a good Lawyer?

There are a number of good lawyers in Spain. Especially lawyers specializing in real estate and purchase assistance for properties. Many potential buyers do not yet or do not sufficiently speak the Spanish language, so at least an English speaking lawyer is important. Since you hire the lawyer yourself, it is important that no miscommunication takes place.

It is important to have personal contact with the lawyer before hiring them to feel whether you have the ‘click’ for your trust.

After finding your dream home, we can always put you in touch with a good native or English-speaking lawyer based in Spain. It is important that the lawyer is independent of the selling party and has good local knowledge. It is very helpful with specific objects. For example, if you buy a ‘rustico’ property (finca in the countryside), a B&B (casa rural) or an apartment in Valencia. Then it is important that the lawyer has the local knowledge, inputs to act quickly and to obtain the correct information.

Furthermore, we are regularly asked whether, in order to avoid additional costs, it is possible that the lawyer who does work within their home country can also do this in Spain or whether you can do this yourself if you have a legal background. This is certainly not advisable. Spain is a large country and the rules sometimes differ per municipality. We always recommend hiring a lawyer based in Spain. Sometimes it is even the case that a lawyer from the Almeria region is not aware of the rules and guidelines in the region of Valencia, for example.

Finding a good lawyer
Buying Costs

Additional Costs

What additional costs for a lawyer should you consider? In Spain a lawyer often charges a basic rate of around 1% of the purchase price + 21% IVA (Spanish for VAT) for the purchase guidance. The costs differ per lawyer, but are in any case usually between 1 – 2% of the purchase price excluding VAT. In addition to a percentage, they usually also apply a minimum rate. Budget for €2000 to €3000 excluding VAT.

Also take into account when calculating your closing costs. In Spain, it is estimated at about 12-13%, but apart from the regional differences that exist, some costs are a bit heavier for lesser expensive homes. For example, with a house of €100,000, the costs to the buyer therefore weigh more heavily in percentage terms than with houses in a budget above that. The attorney’s fees could then be 2.5% instead of 1.5% (including VAT).

Click here to read more information about the buying process and other buyer costs that you can expect, in addition to the lawyer during the purchase process in Spain. In any case, always inform yourself in advance which costs the lawyer will charge. This way you will not be surprised afterwards. It is possible that the costs are higher if you ask your lawyer to assist you in more complicated cases.

Good Legal Advice is Key to your Home

Don’t be put off by this long story. Or by stories you have undoubtedly heard about someone who bought a property in Spain with all kinds of problems. By being guided by a good lawyer, you can make purchases carefree. You do not have to know everything yourself, but if you choose professional legal advice you have the experts looking out for you – to save you from the pitfalls.

We would be happy to help you find a reputable lawyer in Spain, known in the region and who can assist you in your own language, if necessary. Over the years we have assisted many people with their purchase and built up a good network. We are happy to connect you to a lawyer for the best legal advice who best suits you and your situation.

See you soon in Spain !

legal adive is key

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We offer you a whole range of additional services, so that you are completely unburdened and can enjoy the process of buying a property!

We introduce you to the very best partners we work with and highly recommend them as local professionals who can help you along your buying journey. 

If you have any questions about buying or selling a property, want more in-depth information regarding legal issues and taxes or if you need advice about any step of the buying or selling process, contact us now by filling in the form provided.

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Dream Properties Valencia is Certified Estate Agent based in Valencia and meets all legal requirements to carry out the profession of estate agent in the Comunidad Valenciana.

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