So you've chosen the property you want to buy in Spain. Now begins the buying process, and be warned it's very different from buying in the UK, the US and elsewhere. There's no problem with that, but you do need to ensure you take the correct legal advice. The first step is to get a document called the Nota Simple Informativa (simple note of information) from the Registro de la Propriedad (the property registry). This needs to confirm that the property does indeed belong to the vendor, that it is free from debt (so nobody else has a claim on it), and that the details of the property match what you have been told (so specifics on the square metrage floor area and so forth).
Next comes the pre-agreement, a simple contract put in place until the full public deed of purchase is prepared. It will say that the vendor intends to sell their property to you; that you intend to buy it from them; the price and conditions of sale you've agreed. At this point, you will hand over a percentage of the agreed sale price, a holding deposit called an arras in Spanish. If you back out, you lose your deposit; if the vendor backs out they pay you double. You can tailor this 'arras' to suit should you wish.
Next you need to arrange the mortgage, and the documents required are many, certainly more than in the very lax days of UK self-certification mortgages (which in post credit crunch days are largely a thing of the past). Documents typically required are your DNI/NIE; your last three payslips; your last income tax return; your work contract; if self employed evidence of payment of local tax on your work (IAE), also your VAT paid for the last year; a record of your assets, such as bank accounts, statements of savings and so forth; any prenuptial agreements; a certificate from the government (the vida laboral) showing your employment history; your pre-agreement with the vendor; proof that the IBI or property tax on the house is paid up to date; evidence of any other loans or mortgages that you have; all your property titles both in Spain and elsewhere. Non residents also need to provide a certificate of nonresidency (you'll get a form from your bank).
Phew. Assuming you've negotiated all that and got your mortgage, the bank will introduce you to a tasador (appraiser) whose job is to ensure that you are a trustworthy recipient of their cash. You pay for this, rather gallingly, and it should cost somewhere up to €500, though this varies enormously. The tasador also has to be a qualified architect, and the role rather idiosyncratically combines financial assessor and surveyor. The advantage of having a tasador on board (even if you're not raising a mortgage), is that they will also assess the structural soundness of the property.
Okay, we're getting there. The actual transfer of property is certified by a notary (notario), who reads and okays the purchase deed and signs it in your presence. You then need to present your proof of identity (as does the vendor), the vendor's title deed (which is then lodged with the Central Property Register), and your payment for the property. You and the vendor sign, the notary adds his/her 'firma protocolizada' and the deed is done.
You now pay your taxes: transfer tax (impuesto de transmisiones patrimoniales) and stamp duty (impuesto de actos jurídicos documentados). Transfer tax is usually 6% of the purchase price, 7% in some areas. For new builds it's replaced by VAT of 7% for houses, 16% for other properties. Stamp duty is usually 0.5%, though it varies from region to region. The seller will now go to the local City Hall with the deed and pay a sliding scale of tax depending on how long they have owned the property, and the value of the house (valor catastral). You the buyer now need to ensure you have asserted your right to the property by registering the title at the local property office. This sum starts at 0.4% of the property price and decreases to 0.02% for more expensive properties.
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