Is a 5 year wait a record or the norm?

Hi all ,

What is valia tax I noticed that Janmet had to pay?

Also we bought off of viva estates last year and some one else owned the apartment before we bought and we did not know anything about the developers mortgage will we have to pay for not taking their mortgage.

Hi eoin i am also buying off a owner who bought of plan.We could not get a builders mortgage as he would only give us less than we needed to complete but the banks charges for giving us a mortgage was quite a lot, then we have had to pay tax  of E3,096 (mortgage) i dont no what this tax is on a mortgage ?.I also think we should not have to pay the valia tax as i am not buying of the builder but the builders mortgage was a good rate.We also have to pay a 1% bank charge back to the bank if we need to sell or move before the mortgage is finished.bye irene/peter.

Hi Eoin & Irenemontague,

I can't answer your question on valia tax but we also bought off someone who had bought off plan. What we have bought is the contract (benefits and obligations) that the original off plan purchaser owned. So we are in the same position as if we were off plan buyers - with the same contract etc.

With regard to the builders mortgage the contract that we bought clearly states that if we don't take over the developer's mortgage we will have to pay 750€ cancellation fee. A law that came into force in  December 2006 makes this clause in the contract null and void. However it seems that a lot of lawyers and notaries are not aware of this (or choose to ignore it) and the developer is taking the line pay it or we don't complete. I will be seeking further advice on this issue on the general boards.

The mortgage market in Spain is not as competitive as the UK. It is normal for there to be an arrangement fee of 1-2%. This is negotiable. If the percentage of the puchase cost that is being covered by the mortgage is high the lender will impose penalties for early redempion etc. However I am not aware of any tax on the mortgage value. I am far from an expert on these matters but I guess that the various costs have not been properly explained to you - that is something your Lawyer should be doing.

To add to what Max and Davmunster have said & according to what my mortgage advisor has told me you have to add 1.92% stamp duty on the mortgage amount as well as notary, registry, gestor fees & arrangement fees (no arrangement fees if using the developers mortgage) this is on top of the stamp duty of 1% and notary, registry and gestor fees for the actual purchase price of the apartment! Why they charge stamp duty on mortgage amount is beyond me its like taxing you on money you don't have! With regards to the mortgage cancellation charges if I recall correctly some members on this board have through their lawyers managed to get the developers to agree to cancel this charge. From my understanding it is an illegal charge. Somehow I do not see the developers refunding this amount after you have signed. I suspect if everyone stood up to them and reversed the threat i.e. refuse to complete unless they remove this charge they will obliged as they have more to loose by delaying completion!

Land Tax known as Plus Valia (Impuesto Municipal sobre el Incremento del Valor de los Terrenos) is a municipal tax on the increase in the value of land (excluding any buildings), since the last change of ownership. Traditionally it's paid by the vendor but it's also common practice for the buyer to pay it  and many developers of new properties insist on the buyer paying it.   Apparently it depends on the population of the municipality in which the land is located and the number of years the vendor  has owned the land and bears no relation to the value of any buildings on the land.  Plus Valia is low on modern properties such as apartments in urbanizations, where land values have increased little since the properties were built and little land is involved, however it can be high on prime building land which hasn't changed hands for decades.

I understand that the local municipal tax office should be able to tell you how much it is.

It would seem from the above therefore that the amount would be less for a 2 bed apartment with a smaller overall area than a 3 bed apartment (assuming land originally acquired for both at same time) and as €500 has been quoted in 2 posts it looks as if this is the approx. figure that everyone will have to pay.  

Jim and Joan I think your figure of €1500 is far too high and I would recommend further checking before agreeing to pay such an amount.

Regards

Just to answer a couple of queries we paid the 500euros on  a 2 bed 2 bath. Also at no time did we ask for a builders mortgage, it is not in our contract and our solicitor never mentioned it until a couple of months ago. She has told us she will try to get it back and that people have to pay it and then the lawyer has to try to get it paid back, but it is the Judge who decides. The plus valiua tax has never been discussed before the day we signed. 

We have met a few of our neighbours and they are all great people, look forward to seeing you all again soon.

On another note,  we are still living in a ghost town!!!!! Come on you lot get moving and give us some neighbours we only have a few more days before we return home   not back again until end of October.

Hi Janmet,

Great to see that you're in possession and enjoying it!

What's the position about electricity & water in your apartment?  Are you connected for either or both yet?

Do you think its a good idea to leave to the lawyer to sign. Our solicitor has power of attorney but  am afraid that if I am not there that he will sign all the documents that Max just spoke about and not give a dam also he also could sign for the higher price valiia tax and the cancellation of the developers loan of which we knew nothing about so I am going to fight that one.

Please give us some advice before going into the firing range.

 

Hi Eoin, I haven't given my lawyer power of attorney and personally don't think it is wise to do so unless you know & 150% trust the person you are giving power of attorney to for me its like signing your life away! I really don't understand how people can give power of attorney to someone they have just met & in many cases been introduced to by a biased party i.e. their agents / developers but then that is just my personal view of things!

Hi Eion, RG, Our lawyer has power of attorney and signed for the apartment on our behalf, also service contracts. We have had regular contact e-mail, telephone and personally  with her, over the past two years dealing with anything I wish to Question, when on holiday  a partner in the firm kept in touch, and to date have had no problems, and do not foresee any in the future.

  Ken

Hi Ken

You said that your solcitor done completion on your behalf,  did she have to pay the developers morgage cancelation fee?

Congratulations to everyone who has completed.  It all sounds very unorganised - as usual. We are actually hoping to delay completing until some of these kinks have been resolved. 

I find the discussion about the developers mortgage interesting as some of you may recall we had a discussion about mortgages a few weeks ago.  We didn't take the option to decline the developers mortgage but have NEVER received any information from them or our solicitors about the terms and conditions of this mortgage. Hence our decision to go with Green Independent who we met at the Viva exhibition in London - on that fateful day when we got involved in all this! I know there is a commission charge but they have been able to find us a deal with a good interest free period that suits our needs.

Re Power of Attorney.  Our solicitor signed the initial contract for us but only sent a brief version that was incorrect (stating completion Nov 05) and he said that he could do either that or completion but not both.  He said this week that he'd not had any dates from the developers regarding a completion date, which is fine by us. As he's not been very communicative I wouldn't trust him to sign anyway.

Looking forward to meeting up on Sept 16th. Thanks for the accommodation suggestions, still not booked anything yet. Max I'll send you a personal email for any contacts you may have.

This message was last edited by max! on 9/9/2007.

Max, shouldnt the building insurance be covered by the community fees rather then the developers mortgage? if not how does it work in the case of those who have taken out a mortgage elsewhere?

This message was last edited by max! on 9/9/2007.

Hi RG,

Your post (with the reaction of your lawyer) regarding the cancellation of the mortgage was very informative. Maybe you can repeat it in this topic as it was definitely more than a little chit-chat.

The second issue some of us have is with the ‘illegal’ plusvalia which the developer should have paid. Several people have protested against it but had to pay it. This could be a case for a good lawyer?

The third issue is the compensation for the delay. See my post of 6 Sept 8.14 PM below. Are more people  interested in getting financial compensation as you’re legally entitled to it? Maybe we could join forces and appoint one lawyer for all those issues.

Max as you have suggested I have reposted my post from chit chat here. My lawyer advise me that we may be able to sue for compensation for the delay in completion and also for the mortgage cancellation charge. My lawyer speaks very good english & is totally independent. I have queried him further on this issue and I have pasted his reply below: QUESTION: a question about the mortgage cancellation charge. You say that if we do not sign we may loose our right to buy the apartment but surely if the sellers are forcing upon us illegal terms then we have a right not to sign without the risk of loosing the house? ANSWER: It should be like that, but it isn´t .Technically the charge was "agreed" between you two and whilst a change of legality allows you now to challenge the validity of that clause (but a third party will have to decide upon that conflict, that is what is of "better right", the agreement or the subsequent legislation considering clauses like that null and void) that is not automatic. It would be automatic should the contract had been signed, with that clause, after 2006. In our case, the clause is "anullable" -so it is up to us to seek annullability. In the Courts, that is, as Arrohabitatge is not being very reasonable on this one. Mind you: I am of the idea that this "lack of flexibility" in this affair has not its "headquarters" in Arrohabitatge but in Caixa Galicia, the banker that originally granted the Mortgage. I do have the sensation that it would be THEM who are going to collect "Mortgage Cancellation Fees" as I very much doubt that the developer can actually put their hands into a subject like that. And if there is any instance actually a degree more arrogant than a developer in Spain...that´s a Bank. They couldn´t care less. All this is unconfirmed thoughts of mine, of course. QUESTION: However if we do this wouldn't the court take the view that if you paid it at the time of signing then you have voluntarily accepted the terms imposed by the developers? ANSWER: No. In any case we will make a statement that we do not agree with the validity of that Clause and that we reserve all rights under Law to challenge it afterwards. What he is saying seems to make sense. I think it might be best to wait till completion and see how many of us are prepared to take joint action and can then put the case forward to him with regards to feasibility / costs etc. Regards