Buying a flat in Madrid step by step: a worked example

I am often asked what exactly a buyer's lawyer does, from start to finish. The best way to explain it is with an example.

A word of warning: the case below is made up to explain the process. It does not correspond to any real client and the figures are rounded, just to make it clear. Every purchase is different and no two negotiations are the same.

Imagine a buyer who has found a resale flat in Madrid. She loves it, the agency tells her there are other interested parties and asks her for a deposit to reserve it. Before paying anything, she calls me.

The first thing is to know what is really being bought. Before making any offer, I check:

• The land registry extract (nota simple): who the owner is, and whether there is a mortgage, seizures or other charges.
• The homeowners' association debt certificate and the minutes of the latest meetings.
• The latest property tax (IBI) receipt.
• Whether the building has passed its technical inspection (ITE) and whether any works are pending.
• The energy performance certificate and whether what was built matches what is registered.

In our example, the minutes reveal something nobody had mentioned: the owners' meeting has already approved a special levy to repair the façade, of about 6,000 euros per flat, to be charged in the coming months. In addition, the flat has a registered mortgage that the seller has not yet cancelled.

None of this prevents the purchase. But it changes the conversation.

With that information, the buyer is no longer negotiating blind. We prepare the offer together and back it with facts, not impressions.

• The approved levy: either the seller pays it, or it is deducted from the price.
• The outstanding mortgage: we require it to be cancelled with the sale proceeds at the signing itself, and for this to be put in writing.
• The renovations the flat needs, with a quote in hand.

In the example, the seller agrees to pay the levy and we also negotiate a price adjustment for the state of the kitchen and bathrooms. Does it always turn out like this? No. Sometimes the seller will not budge, and then my job is to make sure the buyer knows exactly what she is paying for and can decide calmly.

What I have seen in more than fifteen years is that the negotiation changes when the buyer arrives well informed and accompanied.

Once the price is agreed, it is time to sign the deposit contract (arras). It is the most important document before the notary, and it is often signed using a generic template that does not protect the buyer.

The usual type is withdrawal arras (arras penitenciales, article 1454 of the Civil Code): if the buyer pulls out, they lose what they paid; if the seller pulls out, they have to return double.

In our example, the contract includes:

• A financing condition: if the bank does not grant the mortgage within the agreed period, the buyer gets her money back.
• That the approved levy is paid by the seller.
• That the flat will be handed over free of charges and occupants, and up to date with community fees and IBI.
• A deadline for signing at the notary and who chooses the notary.

A well-written clause here is worth more than any verbal promise from the agency.

While the arras period runs, we review the mortgage offers. Not just the interest rate: also the APR (TAE), the fees and the tied products the bank requires, such as insurance or direct debits.

The 2019 Mortgage Credit Act (Ley 5/2019) requires the bank to give you the loan documents, including the European Standardised Information Sheet (FEIN), at least ten calendar days before signing. During that period you must visit a notary of your choice, who explains the content of the loan to you.

Those ten days are for reading calmly. In the example, we compared two offers and found that the one that looked cheapest turned out more expensive once the compulsory insurance was added.

Before signing I ask for the draft deed and review it line by line: price, method of payment, cancellation of the seller's mortgage, allocation of costs and condition of the home.

On the day itself I check with an updated land registry extract that no new charge has appeared, and that the seller provides the homeowners' association debt certificate. If anything does not add up, we stop and sort it out before signing, not after.

After signing come the taxes and registration in the Land Registry, and there too it pays to have someone watching the deadlines.

I only work for buyers and tenants. I take no commissions from sellers, developers or agencies, so my only interest is yours. I know the property sector from the inside and I am guided by professionalism, honesty, trust and work done well.

If you are about to pay a reservation deposit, sign an arras contract or apply for a mortgage, write to me first. The first consultation is free and I will tell you clearly what I would check in your case.

Further reading: which type of deposit contract (arras) to sign and how to read a land registry extract.