Bank draft when selling house

When you complete at the Notary's office and receive the bank draft from the buyer, how can the validity of it be checked?

does the notary deduct agent's fees, plus valia etc before giving the draft to the seller?

The  2 times ive sold the deposit left by the seller, turnded out to be the agent fee, all the other fees got  deducted  from the buyers money 3% held back  etc etc,  then i got a bankers draft for the rest , which i put in the bank. i suppose it probably comes down to if the agent is declaring he has made any money or not.

But I'm asking how do you know the money has come from a legal  source?

Camosol:    When you complete at the Notary's office and receive the bank draft from the buyer, how can the validity of it be checked?

Does the notary deduct agent's fees, plus valia etc before giving the draft to the seller?

I understand that (at least sometimes) there are more than one banker’s draft.   So who gets what can be arranged.

As for Plus Valia.  That tax is the obligation of the seller, not the buyer (unless very exceptionally the buyer agrees to pay it and that is written into the compraventa).

It the 3% has to be withheld (non tax resident seller) that is mentioned on the deed drawn up by the notary,  and paid into a Hacienda account by the buyer, and the receipt is given to the seller.

As for ‘checking the validity of a banker’s draft’.  That is a guarantee by the bank to pay the sum shown.  It is in effect like ‘cash’.  It cannot be stopped and if lost one must wait until it has become invalid by date before another can be issued.

In the ‘old days’ one usually paid in cash in the Notary’s office.  I remember my son being astounded when we drew out the money for his apartment and took it in cash to the notary’s office and handed it to the seller.

PS  Campo    But I'm asking how do you know the money has come from a legal  source?

That would be nothing to do with the person selling. 

Camposol

Newworld is correct.

The buyer will have all the bank cheques drawn from cleared funds in his/her Spanish bank account to meet the financial schedule/statement agreed by the lawyers (if you are using them) 

If the property has a mortgage to be cleared or debts to be paid the buyer could be turning up with 5 or 6 cheques, If you are asking about the source of the money before the Spanish bank account, I'm assuming you are not, there will be a audit trail, ie transfer reciepts from fx companies or other banks both Spanish and overseas depending on the nationality of the buyer

But I'm asking how do you know the money has come from a legal  source?

When I paid out with a bankers draft it has always had the bank details on it, when I sold and received a bankers draft, same thing, surely the fact it comes from a bank means it's a legal source, is this what you mean? And if the money is from an illegal source is it cause to worry if all goes well.

I have only dealt with one agent on selling and in this case the notary gave me the complete draft, my buyer gave the draft to the notary, who looked it over, took some notes then gave me the draft, I then paid out all the necessary fee's, the agent had already put on her amount on top of what I wanted for the house. 

All other times I have bought  (No agents)  this was reversed, I gave the complete and full house amount draft to the notary, he looked and then he then gave it to the seller. 

I didn't think agents charged a fee to sell, I thought they put a chunk on top which in effect was the agents fee, perhaps it's changed now.

Our agent charges 4% plus Iva to sell.( = extortion in my opinion!) I thought they all worked like this, though fees vary.

If I had added this to the price of the house, it would be even harder to sell.

my concern over the legality of the bank draft is for example suppose the funds the user had in his bank to pay for my house had a dodgy Origen, the house sale went through, and  six months later the buyer's bank found this out, could

the  money paid to me be clawed back.

Pardon my ignorance with what  goes on at the Notary,  I 've never done it.

Surely the Notary sorts out the  money to be paid out, agents fees etc, if not, how is it actually  done.

i would have closed my bank account by then, and the draft will be haded to the man from the well known currency exchange firm., so how could I hand out any money to anyone?

I want to sell my house, but If I do, this aspect is the one I dread most!

I have only dealt with one agent on selling and in this case the notary gave me the complete draft, my buyer gave the draft to the notary, who looked it over, took some notes then gave me the draft, I then paid out all the necessary fee's, the agent had already put on her amount on top of what I wanted for the house. 

These days it's unlikely(unless there was trust and a prior agreement) that a agent would accept getting paid by seller outside of the notary process, ie afterwards. The normal procedure is for them to submit their invoice + IVA of course prior to the notary and then collecting their cheque on the day.

Our agent charges 4% plus Iva to sell.( = extortion in my opinion!) I thought they all worked like this, though fees vary....I suppose if you accept it this way then that is how it is now, just that I have never done it this way, only in the UK, no bearing at all I know.

If I had added this to the price of the house, it would be even harder to sell......Not if the agent is sensible, like everything yes it could be priced out of the market, the agent who did sell one of mine had sold over 200 that year, she put 7,500€ on top of what I wanted and got the full price no knock downs.

my concern over the legality of the bank draft is for example suppose the funds the user had in his bank to pay for my house had a dodgy Origen, the house sale went through, and  six months later the buyer's bank found this out, could...

the  money paid to me be clawed back....No because all that would happen is the buyer if found to be a crook would lose the house, the fact is you sold in good faith.

Pardon my ignorance with what  goes on at the Notary,  I 've never done it....It's easy...Unlike the rubbish way you have to sell a house in the UK.

Surely the Notary sorts out the  money to be paid out, agents fees etc, if not, how is it actually  done....Never has done in any of my buys or sales.

i would have closed my bank account by then, and the draft will be haded to the man from the well known currency exchange firm., so how could I hand out any money to anyone?...If you have to pay out for exe's etc, most likely if you use one, your solicitor would / should do this for you.

I want to sell my house, but If I do, this aspect is the one I dread most!....It's nothing, so much better then the UK, one point though try and get a deposit so if the buyer did back out you get to keep that, or part of, someone I know has done this 4 times now..Is that bad luck or good luck?

Surely the Notary sorts out the  money to be paid out, agents fees etc, if not, how is it actually  done.

No! All the notary does is to notarise the private purchase contract, and the agreements made between seller and buyer. It is normally the job of the lawyers to sort every think out, I say normally because if you don't use one you will have to do it yourself.

I wouldn't dream of doing it myself!

There seems to be a variance of opinion and experience as to what the Notary does.

If the draft is handed to me , all ready to go to the CD man, how can the plus valia and agents fees come  out of it, if they haven't already been deducted by the Notary?  If I have closed my bank account, how can I pay these charges?

I wouldn't dream of doing it myself!

There seems to be a variance of opinion and experience as to what the Notary does.

If the draft is handed to me , all ready to go to the CD man, how can the plus valia and agents fees come  out of it, if they haven't already been deducted by the Notary?  If I have closed my bank account, how can I pay these charges?

For the notary to deduct all fee's wouldn't the draft have to be made out to him and he then write individual cheques out?...Which doesn't happen. 

If you close your bank account then it stands to reason what ex's you did have to pay you still have to one way or the other, best bet is to keep your bank account open with funds in for a little while longer.

You do know that by trying to be helpfull I am running the gauntlet here for the thumbs down dope.

Ive had to keep bank a/c open to get refunds paid back to me ,the buyers solicitor held back 500 euro for any outstanding utilities bills evan tho they cheaked with them on my last days i was upto date .And i still have the bank a/c open, as im  still waiting for my 3% back ( about 3k euro )  17 months later.

That wouldn't be possible for me as I would return to the UK

As I am over 65, tax resident, and lived in the house for over six years the 3% retention doesn't apply to 

Are you sure that the FX company will accept a bankers cheque made out in your name? I would have thought this might cause a problem. The only other way I can think of is to squirrel away a few thousand in cash and then go around and pay any bills with it. 

The man from CD said he will be at the Notary's office on day of completion. The draft will then be put in the bank they deal with. When I ' m back in the UK and I want the money  in sterling transferred to my bank account, they arrange this.

My neighbours did this and it went smoothly.

Camposol.

Just on the 3% Retention. You are of course right when you say it 'should' not apply to you.    You may through need to prove to the notary that you have made tax returns in Spain for the past 3 years.   Otherwise he will / may insist on the retention.

And, as I said before, the seller is the one who must (send / arrange for someone) to go the town hall to pay the Plus Valía tax.  It does not get paid by the notary or someone else.

Johnzx- isn't it customary to produce a tax certificate, in which case, showing returns should not be necessary, although I can produce them if required

Campo, I am not sure what you mean by a tax certificate.  From Spain ?   If so so then you can show you have made tax returns.

Johnzx- surprised you are not aware of this. You apply for a tax certificate from the Spanish tax office and show it to the notary. Apparently, they may not accept just tax returns.