Real estate sale contract: what you need to know
One of the common questions we receive at JLA Notarios is what you need to know if you want to buy any property, such as in cases of purchase of a home, purchase of a plot or purchase of a commercial premises. In this article, we are going to explain what you need to know before signing the deposit agreement and what you need to know to sign a purchase deed at the notary.
JLA Notarios is a notary office in Barcelona specialised in successfully handling contracts such as the purchase deed and mortgage deed.
The deposit agreement, the property sale deed and the functions of the Notary in the sale
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A) What do you need to know before signing the deposit agreement in a sale?
The deposit contract is the contract signed between the person who wants to sell a property and the person who is going to buy it, committing to definitively sign the sale deed at the notary’s office.
The most common practice is to sign the deposit contract privately before going to the notary. It is common for the estate agency to help draft the deposit contract. Although another amount can be agreed, it is usual for the buyer to pay 10 percent of the agreed price.
After signing the deposit contract, if the buyer ultimately does not buy, they will lose the deposit paid. On the other hand, if it is the seller who does not sell, they must return double the deposit, which means that the person who does not sell must return the amount received as a deposit plus an equal amount.
Buyers should know four things before signing the deposit contract:
- Before signing the deposit contract, the buyer must examine an updated simple note of the property they are going to buy. The simple note is a document issued by the Land Registry. The important thing is that the note shows no encumbrances, which means that it is a property without legal problems for sale.
- The deposit contract must set the latest date for signing the sale deed at the notary’s office. This way, the buyer has no surprises regarding the signing date and can organise themselves to apply for a mortgage or prepare the move.
- If the buyer is going to apply for a mortgage: it is advisable to include in the contract a clause stating that if the buyer cannot sign the sale deed at the notary’s office due to not having obtained the bank mortgage, they will not lose the deposit.
- Although the simple note from the Land Registry provides legal security, it is advisable that the deposit contract states that the property being sold complies with all the requirements demanded by law and current regulations.
B) The Notary protects the buyer during the purchase sale
Once I have signed the deposit contract, what functions will the notary perform for the sale? What should I know as a buyer about signing a sale at the notary's office?
At notaries, we verify that the property being sold is legally in order and meets all the requirements demanded by current legislation. The majority of the notary's functions in a sale aim to protect the buyer and avoid future problems for everyone. That is why, in Spain, the law grants the right to choose the Notary always to the buyer. At JLA Notarios we will be delighted to assist you from our offices in Barcelona, and we can exclusively process sales where the signing is done in person in Barcelona at our notary office on the Diagonal.
At the notary's office, we carry out numerous actions to protect the buyer who has entered into a sales contract with a deposit. Some of the documents we obtain and review at the notary to ensure everything is correct are the following:
- Continuous simple note from the Registry and cadastral information: with these documents, the legal and physical situation of the property being sold is reviewed.
- Information from the Public Insolvency Registry: allows us to know if the seller is in bankruptcy or insolvency proceedings and to inform the buyer in such a case.
- Energy certificate: this is the document that states the energy rating of the property.
- In the case of sales of homes, it is verified that the certificate of being up to date with debts to the community of owners and the habitation certificate are in order. Additionally, in certain areas, some administrative authorisation from the Autonomous Community may be necessary to sell, for example, in areas of high population demand.
Furthermore, if the buyer requests a mortgage, the chosen notary drafts the mortgage loan deed and we explain all the details of the mortgage.
If you want to learn more about the functions of a notary in sales, we offer you the following reading:
C) What does the notary do after the signing of the property sale contract?
Once the deed of sale has been signed, the chosen notary must carry out several important functions for the buyers. Thus, the notary will be responsible for submitting the deed of sale to the Land Registry, so that the property can be registered in the name of the buyer.
Also, the notary must make the changes in the Land Registry so that the buyer appears as the owner, which allows the buyer to receive the following year the IBI (Property Tax). Finally, the notary must provide copies of the signed deeds of sale.
If you want to learn more about expenses and taxes of a sale, consult this article:
In conclusion, there are many important procedures to carry out in a property sale at the notary. Therefore, it is important to be informed and to choose a trusted notary. JLA Notarios are a team specialising in property sales and mortgages and we will be happy to assist you at our notary office.
Contact us if you have any questions via WhatsApp, through the contact form on our website or by email at: bcn@jlanotarios.com.
