Although they earn their fees from private individuals and companies, Notaries are essentially public officials who play a neutral role in drafting and witnessing many types of contracts in Spain. Their job is to ensure that both parties to an agreement understand the terms of the contract, that the terms of the contract do not contravene any laws, and to ensure that the appropriate taxes generated by the transaction are paid.
To develop their function they have a delegated power from the State. In this sense, they depend on the Ministry of Justice and they join the profession after passing an official examination. As a precedent legal profession they are incorporated to the Colegio de Notarios presided by Consejo Superior del Notariado. The profession is regulated by Law May 28, 1862 and by Decree June 2, 1994.
What happens in the Notary´s Office when purchasing a property?
When you buy a property in the UK you exchange contracts, pay the vendor, get the keys and the property is yours, after which you are free to register your title in the land register. The big difference in Spain is that you cant inscribe your title in a property register - Spains version of the land register - unless a Spanish notary witnesses the deeds of sale. Under Spanish law a notarys signature is required to elevate a private contract into public deeds that can be inscribed in the land register, so the bottom line in Spain is no notary signature, no inscription in the property register.
For Non-resident buyers it is crucial to register their title in the property register, as it is the only truly secure form of property ownership in Spain. The first person to register title to a property gets to keep it, which is all the reason you need. There are other advantages to, for instance protection, from the vendors creditors and the ability to take out a mortgage against your property. All buyers need to complete their purchase in the presence of a notary. As a result they can enjoy the benefits of registration in the property register.
The notary will also make certain legal checks, though these vary by region. As a minimum they will have requested a property registry filing just before signing to confirm the vendors title, and that the property is free of any (unexpected) encumbrances. This leads some estate agents to claim that buyers are perfectly well protected by the Notary and dont need a lawyer. This is not so. In reality the Notary gives you little protection so you must be accompanied by an experienced and qualified professional when signing the deeds.
If nobody objects to the content of the deeds the notary will pass them around for signing by all parties, and confirm the payment of any outstanding amounts by the buyer before the keys are handed over. This is when you produce payments such as bank drafts for any outstanding amounts on the declared price (the price stated in the deeds less any deposits or down payments already paid). But now comes a very important point of etiquette: if you have agreed to pay a part of the price under the table, which you are strongly advised against, then never produce this cash in the presence of the Notary. Always wait until the deeds have been signed and the Notary has left the room before you bring out the envelope stuffed with cash. The vendor will then count out the money in front of you.
You will be given a copy (copia simple) of the deeds to take away after the signing. Each copy costs around 30 Euros so you should decide how many copies you want in advance. You can use the copia simple to do most things, such as set up utility contracts and pay taxes.
A few days later your lawyer will be able to collect the original deeds signed by the notary (copia autorizada), which are needed to inscribe your title in the property register. In the meantime the notary should have faxed notification of your purchase to the property registry immediately after the sale, thus blocking the register for 10 days and preventing anyone else from inscribing a claim to the same property during this period.
A Power of Attorney is a formal legal document by which you give someone else the power to do certain things on your behalf. Under Spanish law many documents that, in England, would simply be signed in front of a witness, need to be signed here, in front of a Notary Public. It is often inconvenient for the parties to attend in person before the Notary. They will often, therefore, decide to grant a Power of Attorney, authorising a named person to sign on their behalf in Spain.
In Spain there are also certain things that can only be done on your behalf by somebody having a Power of Attorney. Many of these do not need a Power of Attorney in England. These include the conduct of a court case by a solicitor and the signing of title deeds.
For these and other reasons Powers of Attorney are much more likely to be needed in Spain than they are in other countries. The simplest method is to have your lawyer prepare a suitable document, nominating the person whom you wish to appoint as your Attorney and giving him the appropriate powers to enable him to deal with your affairs.
That document - drafted in Spanish and with a translation into English for your use - can then be signed in front of any Notary Public. The person whom you appoint will have the power to undertake a considerable number of tasks on your behalf. Sometimes the powers will be extensive. The person appointed must, therefore, be somebody in whom you have confidence. Because the tasks will need to be performed in Spain and generally over a protracted period, it is usually necessary or at least highly desirable, that the person appointed should live in Spain.
We normally recommend the appointment of your Spanish Lawyer. They are answerable to their professional colleges and under a duty to act in accordance with their clients instructions.
Notifying the person who has the Power of Attorney that you wish to cancel the arrangement is enough to bring the power to an end. If there is any dispute between you and that person, or if you think that the person may wish to use the power fraudulently even though it has been cancelled, then it is sensible for the cancellation to be undertaken more officially.
Notary fees are set by the government according to the number of clauses in the deeds and the declared value of the property. As an approximate guide they range from 0.1% of the declared price of a property (for properties of 400,000 Euros or more) to around 0.4% (for properties of under 100,000 Euros). If you use a mortgage then you will have to pay Notary fees on the mortgage deeds as well.