Lanzarote Property Sales Buyers Guide

Anyone can buy a property in Lanzarote - you don't have to be a Spanish national, nor do you require any complicated paperwork or visas.


Hiring A Lawyer

Once you have found your ideal property for sale then you should first retain the services of an independent English speaking lawyer. Your selected lawyer should then carry out a number of checks on the property that you want to buy, such as consulting the local registry to ensure that there are no debts or outstanding mortgage payments.


Securing A Mortgage

Given the unpredictable fluctuations of the Euro/Sterling Exchange rate it is sensible to apply for a mortgage here on Lanzarote. This process has certainly become tougher than in pre-credit crunch times as many Spanish and Canarian Banks have tightened up their lending policies and criteria, much as banks in the UK have also done.
Non residents can apply for mortgages of up to 70% of the property's purchase price and you will be expected to provide supporting documentation such as recent payslips and proof of income and other assets. Self employed applicants will need to provide at least two years proof of earnings in the form of certified accounts. Mortgage rates vary from bank to bank so it is sensible to secure a range of quotes. As in the UK banks typically charge a mortgage arrangement fee of around 1%.
Non resident mortgages are normally restricted to repayment loans only and decisions are usually processed quite quickly in around 3 to 5 working days.
Your agent will advise you to open a non resident bank account so that funds can be transferred to you in order to complete the purchase.


Valuing The Property

It is of vital importance to appreciate that the bank will only lend to you against their valuation of the property. This will not necessarily be the same amount as the property's listed selling price. Valuations typically cost around €300 and are normally added to the cost of the mortgage.


Other Taxes & Fees

Purchasers should also allow a further 10% of the final valuation price for other fees and taxes, which includes items such as notary and property registration fees, stamp duty and legal services.


Purchase Contract

Once the valuation has been completed and your mortgage application has been successfully processed the next step is to sign a purchase contract which then legally binds both buyer and vendor.
The buyer is obliged to pay a non refundable deposit of 10% of the purchase price. If you should then pull out for any reason you will forfeit that deposit. Should the vendor withdraw they are then legally obliged to refund that deposit and make a payment to you of a further 10%.


Notarisation

Around 4 to 6 weeks after the Purchase Contract is signed the buyer will then be asked to attend the Notary's Office along with their estate agent and a translator if required. The buyer will be asked to present cheques for the remaining balance of 90% and the Escritura is then signed by both parties, so formally handing over ownership of the property.