Tenerife Property & Mortgage Buyers Guide

It can be daunting buying at home, abroad there are added considerations, that’s where our knowledge can guide you step by step. It’s important that you are kept in the picture so here is the low down on buying your chosen property.

Are there clear title deeds?

Once you pay the agency or appointed lawyer 10% of the purchase value, by receipt or pre contract document, the search can begin. This is based on the property document and makes sure all utility bills like electricity, water, rubbish and rates are paid. Most importantly it makes sure that there are no other claims against the deeds or escritura as it’s known in Spain.
Properties on complexes usually receive all or most of the bills in their community fees, these can also include charges for shared landings, walkways and swimming pools. A search will make sure there are no nasty surprises to come in this area either.
The land registry will be contacted to make sure there are no other charges against the property and all old bank receipts and certificates are paid up to date. A NOTA SIMPLE will be issued clearing the way to move forward.

What does the Notary Office do?

With confidence in your deeds, the results can be forwarded on to the Public Notary where it joins the documents from the buyer and seller ready for a new deeds (escritura) to be drawn up. All parties can agree a suitable date for it to be signed and then four days later a COPIA SIMPLE is sent through for the buyer to change the names for utilities and supply title. For a mortgage, it may take a little longer if a valuation and survey are needed.

When do I need to pay the purchase tax?

You have 30 days from receipt of the new deeds to pay the tax, currently 8%. The agent can arrange this and make sure it is presented and receipted by the local council (Ayuntamiento) that covers the area where your new property is, and also the land registry. Just 15 days after that the new deeds are are sent on to you from the Notary.

I keep hearing about retentions, what are they?

These are a small deposit that can be held by the agent or appointed lawyer IF there is doubt over whether you are officially resident on the island or are about to leave the island for a while. Normally if the above steps have gone smoothly this wont be needed but it’s best you keep it in mind. The amount would be around 500 to 1,500 euros and it would be held by the agent or appointed lawyer.

How long will all of this take?

Without a mortgage this whole process should take around three weeks for the original deeds to be checked, then a further four weeks for the new deeds to be forwarded from the Notary and the tax to be paid. If a mortgage is involved you can add on up to another four weeks.

What happens if the buyer or seller pulls out of the deal?

Once the whole process has been started some costs will have been incurred. However if the seller pulls out you will get a total deposit refund, if the buyer pulls out there will be a minimal deduction from the deposit depending on how far the process has gone.