Buying a home is one of the biggest decisions of your life. Before making the decision, it is very important that you not only take into account the price of the apartment you are buying, but also the expenses and taxes that you will have to add to the price of the house.
Knowing the expenses is important to know if you can really buy the house or if you need to wait longer until you have enough savings to face the purchase.
Below we differentiate between the expenses derived from the deed of sale and the expenses derived from the mortgage deed in the case of requesting one to buy the home. These expenses vary depending on each Autonomous Community. In this article you will find the expenses and taxes in the case of buying a home in Catalonia.
DEED OF SALE EXPENSES
- Notary fees: They are regulated by the State so they all usually charge the same. It does not have a fixed cost since it depends on the purchase price of the property.
- Management of the Deed: these are the expenses derived from taking the deed of sale to the Property Registry. The agency may charge for this management around € 350.
- Property Registry: the deed signed by the Notary must be registered so that it is publicly known that you are already the new owner. Expenses can reach € 600.
- Taxes: they will be different depending on whether the house is new construction or second transmission.
- New construction housing: In Catalonia, 10% VAT is paid and it is calculated on the purchase price. In the case of new construction housing with official protection, the VAT would drop to 4%.
- Second transmission housing: the ITP (Patrimonial Transfer Tax) is paid. In Catalonia it is 10% and 7% in the case of being an officially protected home. There is also a reduced rate of 5% for the following three cases:
- Have an accredited disability greater than 65% in any member of the family unit
- Under 33 years old.
- Have a large family card
It is important to know that in the three cases for the reduced rate, in addition, you must comply that the house to be bought is used as a habitual residence and that in the last income statement presented the total taxable base minus the personal and family minimum is less than 30,000 €.
MORTGAGE DEED EXPENSES
We will distinguish between the expenses prior to being granted a mortgage and the expenses once the mortgage is granted:
- Expenses prior to granting us the mortgage
- Appraisal of the home: In the case of applying for a mortgage to buy a home, the bank will make an appraisal of the property to put a value on the guarantee of your mortgage granted regardless of the price at which you want to buy it. Keep in mind that the bank is going to give you 80% of the appraised value or the purchase value (whichever is less). In the event that you need 100% of the amount, you will have to ask someone for help to endorse you. The cost of the home appraisal can amount to between 200 to 450 euros depending on the entity and the final value of the property. The appraisal is valid for 6 months from the issuance.
Since the entry into force of the new Mortgage Law on June 16, 2019, the rest of the expenses are assumed by the bank.
- Expenses once the mortgage is granted
- Commission for opening the mortgage loan: the amount will vary depending on the bank (between 0-2%)
- Hiring insurance / bank cards: depending on the bank, you may be forced to take out life insurance, home insurance, credit and / or debit cards, etc ... in order to grant you the mortgage.
- IAJD (Tax on Documented Legal Acts): since November 2018 a decree law came into force that requires banks to pay this tax. This tax is paid whenever a notarial document is signed which must then be entered in the registry.
- Notary's office: since June 2019, the notary's expenses are assumed by the bank. They are the expenses derived from the execution of the public deed of the mortgage loan.
Now you know all the expenses that arise from buying a home. The total amount of the expenses is usually between 10% and 15% of the price of the house and you will have to pay it at the beginning (the bank will first remove these expenses from your account to meet all these payments) So it is important that before thinking about buying a home you have a Provision of Expenses or Funds prepared.
At Grup Clavis we love to help our clients feel safe and well advised throughout the mortgage purchase and processing process.
We offer you totally free legal and tax advice to solve all your doubts and to help you get the mortgage with the best possible conditions.
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