Below we guide you through the process of buying property in Mallorca:-

1. First you have to obtain an NIE number – this is a unique taxation identification number and needs to be obtained before you can open a bank account, purchase property or any other legal process. You can either apply at the local police station or contract a solicitor who will handle this for you.
   
   
2. Those requiring a mortgage in Mallorca or at least interested in finding out whether it would suit you to do so, should make initial enquiries before entering into a property search. Most Spanish banks offer mortgages to foreigners and it pays to shop around. Barclays Bank offer potential mortgage customers a free, no obligation assessment for example.
   
   
3. Once you have decided on financing and have found a property in Mallorca, you will usually need to pay a reservation deposit. Upon signing of a reservation agreement, you will normally be required to pay 1% or 2% of the purchase price. The vendor will then withdraw the property from the market and your solicitor can begin the necessary checks on the property.
   
4. It is imperative that your solicitor determines that there are no mortgages or outstanding debts or claims against the property. If this is not undertaken, and later a claimant appears with a valid claim, they will be able to claim against the new owner, i.e. you.
   
   
5. Once your solicitor has completed these initial checks the contract of sale and purchase is signed by both the vendor and the purchaser. At this time you will normally be required to pay a deposit of around 10%.
   
   
6. If you are buying property in Mallorca off-plan or purchasing during the construction phase, it is essential that the constructor supplies the investor with a copy of their bank bond or the insurance cover that protects the purchaser in the event that the builder cannot complete the property. In the unlikely event of this happening, you will receive a refund on all monies paid. Furthermore, the contract of sale and purchase must comprehensively, and in as much detail as possible, list and describe the specifics of the property including internal and external measurements, fixtures and fittings, finish, layout of rooms etc.
   
   
7. Upon completion, buyer, seller and both parties’ lawyers along with a bank representative meet at the notary’s office and sign final contracts. Monies and title deeds are then transferred.
   
   
8. Costs vary depending on the type of property you are purchasing in Mallorca. New properties are liable to 7% VAT plus 1% stamp duty, older properties just attract the 7% VAT. Land attracts 16% VAT plus 1% stamp duty. Lawyers fees are usually around 2%. By rule of thumb, if you are buying a property, work on paying an additional 10% in fees and VAT. If you are buying land work on 20%.

If you have any specific questions regarding the legal process of buying property in Mallorca, don’t hesitate to contact us for more information.

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