Bank repossession in Spain: The purchase of a bank repossession in Spain is different from a normal purchase procedure or the purchase of a new construction project. Just as buying new construction is not for everyone, so is buying a bank repossession in Spain. Think before you start, but don’t worry, we will make sure that everything runs smoothly and that you have the key to the purchased property in no time. Be sure to contact us regarding the possible purchase of a bank repossession in Spain.
Bank repossession in Spain
Bank repossession in Spain: caution!
We have already made allusions to the fact that buying a bank repossession in Spain does not follow the same rules and procedure as a normal purchase. Below we will go deeper into the procedure and explain various matters.
It is important to know that buying a bank repossession in Spain is usually cheaper than the normal market value, but you will also (often) be faced with unpleasant surprises and will have additional costs. After all, the bank confiscated the property at the time. And done nothing with it. There is therefore a good chance that there will be no more electricity, the same for the water supply. This is not arranged in a day and will take several weeks and also involve additional costs. Maybe they are not that bad, but this can also cost hundreds or even more euros if documents are missing and/or the installation is not compliant. Keep this in mind, don’t buy bank repossessions if you don’t have a little financial margin. We speak with a “bank” not with a physical person and so you will buy what you see. No more, no less and you will have no rights regarding hidden defects, “I didn’t know that…”, etc.
Buying a bank repossession can therefore be very advantageous, but can also entail extra (hidden) costs, keep this in mind!
The Bank
You buy a bank repossession in Spain through the Spanish bank, right?
No.
It makes no sense to ask a Spanish bank what they have for sale. They will refer you to a subsidiary that looks after the sale of the bank repossessions and has a separate website for this on which the adjustments are made on a daily basis. What makes it even more complicated is that you cannot speak or negotiate directly with those people/bank/subsidiary. You need an extra intermediary: a broker approved by the bank who is allowed to sell the bank repossessions.
Below is an overview of useful links to the websites where you will find bank repossessions and with which we can guide you through the purchase without any problems:
- La Caixa / Servihabitat: https://www.servihabitat.com/en/
- BBVA / Haya: https://www.haya.es
- Abanca: https://www.escogecasa.es/
- Acciona: https://inmobiliaria.acciona.com/?language=en
- Hipoges: https://portalnow.com/es/
- Vivantial: https://www.vivantial.es/
The Broker
A “normal” broker, like there are thousands in Spain, cannot sell you a bank repossession. After all, he must be appointed by the relevant bank(s) in order to be allowed to sell the bank repossessions. In other words, if you find real estate that interests you on one of the websites of the banks’ subsidiaries, you have two options:
- fill out the form on that website and you will be assigned a broker by the bank within a few days;
- or send us the link of the property you wish to view/in which you are interested and we will put you in touch with a broker approved by the bank who will arrange everything for you and work with us to ensure that everything runs smoothly. The advantage of this is that we know these broker(s) and they know us, as well as our working method and that everything will go much faster and smoother.
You do not have to pay the broker, he receives a commission from the bank when the property is sold.
The offer
Making an offer for the purchase of a bank repossession in Spain is different from a normal negotiation for the purchase of real estate. The moment you wish to make an offer for a bank repossession, you need:
- To be in possession of a Spanish NIE number;
- To have a Spanish bank account with funds;
- To make a deposit to the bank at the same time as making the offer. This deposit must be made from your Spanish bank account and the amount is determined by the selling bank.
In other words, if you are considering buying real estate from a bank repossession in Spain, there are a few steps to take FIRST. This is in contrast to a normal procedure, where the above points do not apply.
So be on time, because we can already realize all these steps together or for you with a power of attorney.
The offer is transferred via us and the broker to the selling bank and then it is waiting… waiting for the head office to confirm that the offer has been accepted or rejected. If the offer is accepted, we continue with the purchase procedure. If the offer is rejected, the selling bank will refund the already paid deposit (which you paid when making the offer) to your Spanish bank account.
Bank repossession in Spain: documents
When the offer has been accepted, we will start the next phase of the purchase: providing all the documents required by the selling bank, as well as all the documentation necessary for the execution of the deed at the Spanish notary. You will need to provide us with the following documents:
- Certificate (in English or Spanish) from your home bank account, from which you will transfer the funds to your own Spanish account;
- Proof of origin of the financial resources that you are going to use for the purchase in Spain;
- Transfer all funds for the purchase from your home bank account to your Spanish bank account;
- Certificate from your Spanish bank that the funds for the purchase are in the Spanish account (we take care of that);
- Latest tax assessment/return, translated into Spanish (translation can be arranged through us);
- 3 last pay slips if you are an employee translated into Spanish (the translation can be arranged through us);
- Proof of self-employment if you are self-employed translated into Spanish (translation can be arranged through us)
You do not have too much time to arrange this, which is why we always recommend collecting all documents in advance. Once the selling bank has accepted your offer, we can immediately start with the translations (usually this takes between 5 and 8 days) and you can transfer the funds from your account to your Spanish account.
When you meet all these obligations, we will transfer all these documents to the selling bank and they will conduct a (financial) investigation. It is only when we receive this confirmation from the selling bank that you are certain that you will be able to purchase the property and that we can schedule the date for the execution of the deed, usually within 3 weeks after the final agreement.
Provision of funds
At this point, you will have already received a provision from us for your extra costs associated with purchasing a bank repossession in Spain. We usually talk about the following:
- The transfer tax on the purchase value. This varies by region.
- The notary fees
- The registration rights
- Our legal and guidance costs
- Translation fees (if applicable)
- Cost of utility connections (if applicable)
- Other costs (if applicable)
This provision must be in our clients account one week before the notarial deed is executed. With this we will pay everything that needs to be paid and it goes without saying that the difference will be settled.
Deed
If everything is in order, that is to say that the date is scheduled for the signing of the notarial deed, you will of course still have to pay for the property. This is only possible via a certified bank check from your Spanish bank. These checks cost money, usually between 0.4% and 0.7% of the value they will represent. So also take this extra cost into account when you transfer the necessary funds to your Spanish account.
The Spanish notarial deed will be fully prepared by us together with the gestor of the bank (another party…). If we have a power of attorney from you, we will also sign the deed and receive the keys. If you are present yourself, we will go to the notary together with you and take care of the verbal translation of the Spanish deed.
Debts
Let’s get straight to the point: YOU DO NOT BUY DEBT-FREE with a bank repossession. All right, now I have your attention. A bank repossession in Spain is sold in the condition in which the property is. With its visible and invisible flaws. Without certificates of debt. In other words, you are buying more or less “blind”. But don’t worry and let me nuance this: After all, we have it included in the deeds that the selling bank is and remains liable if debts should arise after the deed has been passed, that is, after you have paid and have become the owner of the property. Then we have 5 days to contact the responsible department of the selling bank (another party…) who is responsible for these matters to inform them that there are still debts, for example and to give them the provide necessary evidence. However, they do not guarantee debts to utility companies such as water and electricity. But usually by then the supply of these services has already been suspended and often the meters are sealed or removed.
Bank repossession in Spain: fianlly
The last part of the procedure is converting all utilities, having all your recurring costs on direct debit, registering with the Land Registry and Catastro that you are the new owner, paying your taxes, etc. This is all done by us and taken care of for you so that you do not have to do anything, but can immediately enjoy your new acquisition.
The purchase of a bank repossession in Spain is therefore a different procedure than a normal purchase. This is intended for people who have the financial means to be able to place a bid quickly and immediately start working on the purchase. If you do not have the financial means or have yet to start a financing application to pay for the purchase of the bank repossession in Spain, we strongly advise you not to make an offer. You will lose your deposit if you fail to purchase, or if it takes too much time. After all, the bank wants to sell the property as quickly as possible. Keep this in mind!
