and.... the rest of the article ( If you want to see part I, click on here )
6) Charges on the house: It is very important to verify which charges exist on the house, and check out if it is free of charges, loans and encumbrances. In order to check that out, again, the most useful instrument is a Nota Simple.
The mortgage can be fully paid before the transaction and be cancelled by the owner or the buyer will have to subrogate that mortgage, which means that he will have to accept it and become the debtor of the remaining debt against the Bank which has granted the mortgage. It is necessary then to know on interests’ rates, recovery time, and commissions and of course the amount still owed. It will be convenient to ask in the bank as the Nota simple doesn’t reflect all these details.
7) Community of owners fees. If it is a resale house, you need to have information on the situation of the house regarding payments to the Community of Owners. Ask it to the Property Manager/ Administrator or the President of the Community, get copies of the Statutes and internal rules of the building too.
8) Price, deposit and payment method: The contract will specify the price of the house and the payment method. There is no VAT to be paid on resales. You will have to pay the Transfer Tax which is of 7% of the property price.
9) There are certain kinds of houses which have official value, the Treasurey Department of the Autonomous Community has this information, check the Nota Simple to see that your house is not VPO.
10) Public deed signing date: Very important to have a determined and clear date for signing the Public deed before a Notary, and if time extensions are agreed, these need to be clearly communicated and agreed between the parties.
11) Related expenses: Need to be mentioned and how-who will pay them:
Plusvalía (a tax over the value rise of the property from one to the next transmisión)
Notary Deed.
Registration in Land Registry.
Transfer taxes
If nothing is specifically mentioned or if it is agreed that expenses will be paid “according to Law” , the seller will pay Plusvalía, and most of the Notary Deed and the buyer will pay the copies of the Notary deeds, the registration of the Property in the Land Registry and the transfer tax.
12) Choosing a Notary: The buyer has a right to free election of Notary.
13) The private contrat is sufficient to link the two parties to what is agreed in the contract clauses but it is not sufficient in order to register the property in the Land Registry or to ask for a mortgage. You need a Notary public deed for these two.
I will write on Notary deeds in a future article.
14) Cancellation clauses and penalties for delay (equilibrium) .It is convenient to put the parties in balanced conditions in the event of cancellation of the contract and establish equivalent compensation for these cases of cancellation.
15) Agreement on juristiction or submission to arbitration.
Chipiona beach ( Cadiz, Costa de la Luz, Spain) by Werkmens at Flickr.com
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