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Buying a Property in Spain

1) You should know that purchase contract is a compromise arranged between you and the seller or the real estate agent. The contract should fix a payment schedule, completion date a proper description of the property. It is quite usual that the seller ask you for a deposit to reserve the property. 3000€ is usual and up to 10%. Once completion is coming, we contact you to give you a final breakdown which includes detail of expenses and after confirmation, the notary appointment is arranged and the sale finished.

Buying a new home in SpainIt is quite important to open an account in Spain before completion is coming as last payment should be paid at the notary. This means the money for the final payment should be transferred to Spain at least 2 weeks before the appointment. A couple of days before the signing, we will order the proper figures at the bank so we can collect the cheque/cash there and go directly to the notary.

You should also take into account, the new Title Deeds in your name should be registered; this procedure will take approx. 1-2 months.

- An NIE number is essentially a tax number for foreigners in Spain. You need one if you are going to buy a house or a car, if you are going to work for a Spanish company or if you want to apply for a residency card.
To get an NIE number, we need to go with us to the foreign department at your nearest the police station .You will need to take your passport. The forms are fairly straightforward and you will have your NIE number within 2-6 days of applying

2) These are the expenses (figures approximated) you should pay when you buy a second hand property around 13%.
The agency commission is paid by the vendor
 
Notary: 700 Euros
Land Registry: 300€
Transfer Tax (10% over the value declared for the property)
Water electricity contract and direct debit for Suma office around 420€
NIE number 90 € per person
Registration fees 300€
Solicitors fees 800€

At the signing of the Deeds, we will take these approximated figures to meet all payments on your behalf. If you buy with a mortgage loan, the bank instead of us will retain these as they will be in charge of the registration procedure.

Document needed to open a bank account in Spain

- Latest income tax declaration P60 (where applicable).
- Copies of pay slips for the last 3 months.
- Copy of your passport
- Personal bank statements (last 3 months).

Finally, we would like you to know we will always work for you and we will do our best to make this process easier and clear for you. Our team will be very pleased to meet you.
 
We hope this information is helpful but if you need for further information, please do no hesitate to contact us.

Spanish mortgages
Please bear in mind if you buy a property with Spanish mortgage the cost will increase up to 3 or 4 % on the top of the 13% as their will be additional cost for notary and registry fees, bank commission, property insurance and life insurance and some additional tax

Main lenders:
Most Spanish banks (Sol Bank, Caja Murcia ) and Building Societies will offer mortgages for properties purchased on the Costa Blanca. The bank will enter into agreement with the purchaser and the loan can be increased up to a maximum of 50% for non member of the European community and 70 % for members of the European community of the valuation of the completed property.
    
The maximum amount you can borrow will also depend on your income. In general, the rule of thumb is that you will be advanced up to 3 times your gross annual income, but usually the monthly repayment should be under 33% of your net disposable income.    
          
Interest rates:
Interest rates for mortgages in Euro are based on EURIBOR (Euro Inter Bank Offered Rate).  The lenders will normally charge EURIBOR + 3%
Today around 6%
        
Interest rate review:
Interest rates will be reviewed annually, on the anniversary of the loan, then fixed for the period of one year until the next anniversary.

Buying a new home in SpainMaximum repayment term:
In general, the maximum repayment term is 15years, but up to 25 years can be arranged. This will be dependent on the age of the borrower. The eldest partner must not go beyond his 70th birthday by the end of the term of the mortgage. This means that for a couple, where the eldest partner is currently 55 years old, the maximum repayment term on offer would be 15 years.

Early repayment:
Most lenders will permit early repayment. The cost of this will vary from zero to 1% depending on the loan. Some lenders charge for cancellation only in the first 5 years. You must let us know if you are considering an early repayment option, so we can choose the appropriate lender for you.

Documents required:
The documentation required will vary from one lender to the next. As a general guideline we have listed most of the paperwork you are likely to need, it is a good idea to prepare much of these as soon as possible.

If you are employed you will need to produce:
- Latest income tax declaration  P60 (where applicable).
- Copies of pay slips for the last six moths.
- Credit report
- Copy of your passport.
- Personal bank statements (last 6 months).
- Job certificate

We will help you:
To choose your lender, carefully considering all of the many variables that need to be considered, including the location and type of property. Keeping up to date with all the banks current offers, terms and conditions, knowing their requirements and matching them to those of the client is a highly specialized job, which is why we use our in-house independent mortgage advisor at LA CASA BLANCA ESTATES
Should you have any questions or require more information please do not hesitate to ask.

If you are looking to buy a property in the Costa Blanca and would like more information then contact us at This email address is being protected from spambots. You need JavaScript enabled to view it.

Buying a new home in Spain

When buying a new home in Spain, there are additional extra costs over the basic purchase price. The total amount of these expenses will be around 10% of the basic purchase price.

Buying a new home in SpainExample: £ 75.471 (€ 120.202,42)

Spanish transfer tax (V.A.T) 7% - £ 5,283 (€ 8.414,17)
1% stamp duty - £ 754 (€ 1.200,01)
Notary fee - £ 320 (€ 51 0,86)
Water and electricity contract and connection - £ 377 (€ 601,01)
Spanish Solicitor around - £ 377 (€ 601,01)

Buying a new home in SpainBuying Step by Step

Reservation
When buying a house you pay //3000€// 2.100£ as a fee in order to reserve the specific property you have chosen.


First payment

Within 40 days you normally pay 50% of the purchase-sum, 7% VAT not included, receiving shortly afterwards the contract of sale to be signed by you.

Buying a new home in SpainMortgage, Final payment & Title deed
The final payment is to be paid when delivering the house with all the keys belonging to it. Since the Spanish bank laws don't allow mortgages to buying properties until they are completed, you can only finance the final payment from Spain. Normally you get a mortgage of 70% of the purchase-sum, VAT not included, but if you have a security or other properties in possession, it is possible to get a mortgage up to 70% of the purchase-sum (subject to the annual income). Finally, when signing the title deed you also pay the costs corresponding to 7% VAT and 2-3% for the administration of the purchase, charged by the authorities in question.

Annual costs

Buying a new home in SpainCosts vary according to the size of the property. The following are estimated charges:

. Water £95
. Electricity £115
. Local rates £75
. Community fees £150

Mortgages in Spain

Mortgages are available in all major Spanish banks.

Spanish banks may offer a mortgage of up to 70% of the purchase price of   the property. However, the normal thing would be ask for 60%.

The interest rates in Spain at present may be 3, 25% (variable rate).The bank would fix this for the first year.

You can choose the repayment periods.

The age limit for a mortgage is 75 years. Therefore, the borrower must finish paying the mortgage by that age.

The documents needed would be annual income on a tax statement and monthly proof of income (payslips).

If you are looking to buy a property in the Costa Blanca and would like more information then contact us at This email address is being protected from spambots. You need JavaScript enabled to view it.

Adventure Trips

We would like to invite you to come on one of our ADVENTURE trips. These normally take around 3-4 days, during which time we will have been able to show you around the area, allow you to relax and show you only properties that we feel will be of interest to you. Our inspections trips are tailor made for you and are only conducted on a personal one to one basis.

Adventure TripsWe can arrange Inspection flights and bed/breakfast accommodation at £50 per person for 3/4 days. You will be expected to pay for your own flights and accommodation. The reason for this is that we do not want you to feel under any obligation or pressure to buy from us.

However, if you do buy from us on your inspection we will be offering you our package deal.

Buying a home in Spain is a simple and straightforward process and you should never feel under pressure to make a commitment or sign a contract. We only want satisfied customers who would gladly recommend us to others.

There is no pressure to buy. We will ever be inferred on your viewing trip. Our representatives are not sales person they are guides. They will be guiding you and answering your question. They do not work on commission basis, so they do not know how to push.
    
All we ask is that clients who join us are serious about buying a property and have the finances to proceed IF AND ONLY IF they see a property that suits their needs entirely.

Our properties are in great demand now, a deposit will reserve and remove your chosen property and plot from the market, and the price of that property will be fixed in Euros. This means that you will not have to pay any price increases, which could be implemented by the developers before your completion date and clients who are purchasing now will undoubtedly benefit from a quite exceptional exchange rate.

Adventure TripsOur Package Deal

1.- A white good package. (fridge, washing machine and a hob.)
2.- A wine package (red wine white wine and champagne)
3.- A satellite TV package with English Channel.
4.- Re payment of all the expenses on the inspection trip.

All of our tours include:

- free transport and picking from Airport.
- Introduction to an English speaking lawyer.
- Assistance with opening a bank account with a major Spanish bank.
- A trip to view furniture for your new home (if required).
- Accompanying you to the builders head office to sign the contract to purchase your new home.
- Introduction to an investment counselor.
- Introduction to Global Currency Exchange Network.

Please note: all the above are subject to time permitting.

Complete our questionnaire!

For more information about adventure trips please contact us at This email address is being protected from spambots. You need JavaScript enabled to view it.

The Real Investment

Secretes, for the art of investment

The Real InvestmentDue to the large number of foreign buyers and the still relatively low prices, the Spanish Real Estate market is an extremely attractive investment possibility. Below you can find an explanation of how you can realize high returns on your investment.

Price increase during the construction of a new development:

A new development has a number of price increases during its construction stages.

The first one is when the company has received their building license and can start to build. They usually increase the price by 10% at this stage. When they start building the show flat, they usually increase the price by another 10%. When the show flat is finished, they usually increase the price by another 10% and when the complex is almost finished, the gardens and the last face are being done, and the pool is finished they usually increase the price by another 10%.

Investors who are familiar with this process can use their money to gain a handsome profit. They can reserve one or more apartments off plan before the building license has been given. They usually have to put down 40% until 50% of the total purchase price during the construction. The remaining 50%-60% will be paid by mortgage, but the investor has no interest in paying this Mortgage, as they will sell the apartment right when it is finished.

Smart Money Is Moving To Spain
      
Why buy a new property?
- Guarantees on building work
- You can add extras during building, such as swimming pool, extrabig garden, extra bedroom, & garage. Anything is possible.
- The payment for the property is usually in stages.
- You get a blank canvas for all those decorating ideas.
- Everything is shiny and new.
- Getting a mortgage will be easier.

Clients whom are looking to maximise their investment should buy 'Off Plan' .

'Off plan' purchases have seen some spectacular returns for thousands of people over the last couple of years here in Spain, especially on the Costa Blanca
Buying 'Off Plan' means reserving a property on a new development before the property is completed, often before construction has started. Exactly like, you can do in Britain.

The Real InvestmentThe developer is obviously very keen to sell as many properties as early as possible to obtain better interest rates on their development loans from banks and investors. To help sell the properties at this early stage the prices are normally extremely competitive for the reason above and because there is nothing to show potential purchasers except a floor plan and artists impressions of the finished development.
Here again, similar to what you can do in Britain. However, in Britain prices have been to slow down dramatically, hence the smart money is moving into Spain where prices are still racing ahead by as much 30 to 40% a year rallied on by potential buyers from around the world.

For example: Purchase Price: 100,000 euros (Jan 2004) Deposit payable: 50,000 euros

Let us assume that the price of the property in April 2005 on completion 150,000 euros. (This is a much lower return than has been achieved in recent years).
Your profit is 50,000 euros, which is obviously on the top of 100,000 euros asking price and is fabulous  50% return  on your money but remember all you have had to pay is a 50,000 euros deposit so your actual return on cash invested is 100%.

When you purchase from a good developer and the location of the development is good, i.e. at the beach or close to a golf course, you can accomplish these high returns as well. La Casa Blanca can advise you with the selection of the development and guide you throughout the buying and selling process of your properties.

However, with our especial offer you can make even more money

1. Buy a property off plan in the booming Spanish property market
2. Pay your deposit.(50%)
3. Let your investment build in value whilst under construction
4. Take delivery of your new property with the balance fees and taxes covered by the mortgage
5. Pay no mortgage payments for 2 years.
6. But rent out your property to produce an income, in the main time
7. Either sells your properties after 24 months .pay of the mortgage and collects your profit or commences the payments and keeps your property, as an alternative to poorly paid pensions as renting can easily cover your mortgage especially when your interest rates are 3,25%

For more information about property investment contact us at This email address is being protected from spambots. You need JavaScript enabled to view it.