A lot of european citizens dream about buying a property in Spain and a lot of them get it. Sometimes, they buy the property paying the price with their savings, however others need a bank loan.

In this case, the buyer will need legal advice about banking law and about many other details of entire purchase process. For example, legal advice about mortgage deeds necessary.

From July – 2019, the banking law was changed in Spain. A new law came into effect making the signing of a mortgage deed become a very complicate and tedious process.
Once the clients (borrowers) aceptt bank loans´characteristics and conditions, they have to go the Notary to complete a pre-contractual phase. The Notary will verify that the financial institution has delivered all the required documentation according to the type of mortgage loan requested by the clients.

The financial institution is laible for sending to the Notary the following documents:

  • The draft loan contract
  • The European Standardised Information Sheet
  • The Standardised Notice Card
  • A simulation of the periodic instalments to be met in different cases showing the possible changes in interest rates.
  • A document on the expenses associated with the public writing of the credit.
This documents will sent to the Notary 10 days before the signing. During these days, the clients will have to meet with the Notary who will explain the most important aspects of the loan.
Moreover, the Notary will answer all questions so that the clients can have a complete understanding of the rights and obligations.  

Finally, the Notary will give a small test about all the information that have been explained. After this pre-contractual phase, on the difinitive day of the signature, the sellers, the buyers/borrowers and the bank representatives will meet together with the Notary. However, only the borrowers and the bank representatives sign the public mortgage deed.

And finally, the notary will prepare a copy of the mortgage deed to send to the Property Registry. If all that is ready, the Property Registry will register the purchase and the mortgage.
For all these reasons, we think that “…the signing of a mortgage deed become a very complicate and tedious”. And, it is recomendable to get legal advice before signing a mortgage deed in Spain.

If you need legal advice about mortgage deeds, do not hesitate to contact llucia&AS-ABOGADOS. We will be very glad to attend on you.