Title deeds and land registry. These words can raise many questions when it comes to buying a home: what are each of these procedures, are they compulsory, who can help me to carry them out successfully, and how should I proceed?
It may seem complicated, but if you have access to the right professionals, the experience will surely be a success. At Sonneil we offer you an all-round service when buying a home, and we can help you with all these formalities.
In the meantime, here we explain them to you:
Title deeds and land registration: two procedures that go hand in hand
Everything you need to know about these two procedures before taking the step of buying a new home.
Once the purchase contract has been signed, you may choose to keep the contract private. However, even if the purchase contract is made privately, either party may request the other party to convert the private contract into a public deed and, if the other party refuses, they may request the intervention of the courts. Furthermore, in order to register the purchase in the Land Registry it is always necessary to execute the public deed.
What is a public deed?
A public deed is a document authorised by a notary, which reflects the will of the parties, listing their identities and responsibilities in the document. The parties are also informed of their obligations and duties arising from the contract as agreed.
The notary attests to the authenticity of the deed, and the statements made before the notary by the buyer, the seller or, if applicable, the mortgage lender, are included in the deed. This serves as proof for all parties and none of the parties may deny the statements contained therein. Notarial records are the highest legal standard of evidence between the parties.
The execution of the deed, the actual handing over of the property, and the payment will take place in the presence of the notary, who must specify in the deed the price of the property, indicating whether the money is received before or at the time of the execution of the deed, as well as the total amount and the methods of payment, i.e. bank cheque made out to the seller or payable to the bearer, bank transfer, debit…
If the payment is made before the date of execution of the deed, the notary must indicate the date(s) on which the payment was made and the method of payment used on each date.
Before authorising the deed, the notary will ask the Land Registry for a report in which the ownership and expenses of the property are indicated.
Land Registry: the final step
Now that the deed has been executed, you can decide whether to keep it private or to register it at the Land Registry to make it public. This is not compulsory, but it is highly recommended.
Why? Basically, because registration is necessary so that the buyer’s newly acquired right is fully protected. As the buyer, you will be:
- Considered the sole true owner unless proven otherwise.
- Protected against the seller’s creditors.
- Protected from undisclosed liens against the property.
- Able to legally protect your rights.
- Once your rights have been registered, no one can effectively acquire any rights to your home without first obtaining your consent.
- You can obtain a mortgage loan to finance the purchase of your home. The bank can only register the mortgage that secures repayment if the buyer registers his or her ownership rights.
Who pays for the registration?
Unless otherwise agreed, the registration of the property in the Land Registry is paid for by the buyer. The price of registering a property in the Land Registry varies depending on the value of the property indicated in the deed of sale. The price will range from 24.04 euros to 2,181 euros.
What do you have to submit to the Registry Office?
In order to register the property rights in the Land Registry, the following documents must be submitted to the local Registry Office:
- Certified copy of the deed of sale.
- Printed tax self-assessment form, which certifies the payment of taxes in a bank.
- The most recent Property Tax (IBI), or a cadastral certificate showing the cadastral reference of the property. These documents must be attached to the title deed and any copies thereof.
- Proof of submission of a copy of the deed to the local tax authority for the purposes of the Tax on Gains in Value of Urban Land (IIVTNU), also known as municipal capital gains tax.
The regional housing authorities may also require the seller to provide a certificate of occupancy certifying that the property complies with all the technical requirements for habitability. Properties for resale, provided they have a valid supply contract, do not need to show these permits.
Who handles the registration?
The submission of these documents to the Land Registry can be done directly by the buyer, an agency, the Notary Public, a lawyer or an agent.
Regardless of who submits them, once these documents are in the Registry, the process must be completed within 15 working days. If not, there will be a 30% reduction in fees.
The registrar will verify that the agreement has been made with full legal effect and the buyer’s ownership rights will be registered in the Land Registry. If the registrar finds any defects in the documents that prevent them from being registered, this is notified to the filer of the document and to the notary who certifies it.
Defects detected by the registrar can be corrected. If the buyer disagrees with the registrar, a second opinion can be requested from another registrar, which can replace the first opinion. The corresponding appeal can be lodged with the General Directorate of Registries and Notaries, or it can be challenged directly before the Court of First Instance of the capital of the corresponding province.
Now that you have a better understanding of how deeds and registrations work, you are more prepared for one of the greatest adventures of your life: finding your ideal place. Can we help you?