- This topic has 21 replies, 6 voices, and was last updated 16 years, 11 months ago by
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You will be expected to pay a reservation fee to remove the property from the market. The agent often put you under pressure to pay the reservation fee, insinuating that you will lose the opportunity unless you move fast.
The purchaser provide a non-refundable in any case reservation fee, this fee is currently between 3000 and 6,000 euros to hold the property for about one month.
The reservation fee is non refundable if you fail to execute later the purchase agreement and does not adequately protect your position because you sign without knowing anything about the development.
There is a very high percentage of Brits buyers who lose this money because during this term of 30 days they do not obtain the necessary funds to pay the first instalment stipulated in the later purchase agreement (5-15 %).
Another percentage pay the fee and hire a lawyer who advise against purchasing in these conditions because the developer does not have the licenses or the bank guarantees.
It is very difficult to get the money of the deposit back.
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I am afriad a good lawyer finds a way out of the situation either in terms of working or the legal loop holes.
Acting as a notice board to something we all are aware is just a way to get some publicty on the Forum.
In, France you have two weeks cooling off period and further if you are not able to obtain a mortgage your deposit is refunded in full.
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You say “If my lawyer cannot find a legal way out of a situation, than what am I paying him or her”
Irrespective of what Country and what the laws are, do you honestly think that just because you pay a lawyer, they should be able to find a way out of ANY situation, be it property purchase or anything else?
Perhaps you believe that Mr Black’s lawyers in USA were not up to scratch them, despite the hefty fees one could expect? -
mg : No I am not suggesting what you say at all. Whether its Mr Black, (who in my opinion got away with a much lighter sentence/fine) only because he had a very good legal team. The same can be said about OJ Simpon, or Michael Jackson to mention the high profile cases.
The lawyers job is to find a procedural/legal solution to the situation his/her clients find themselves in. This distinguishes a good lawyer from not a good one and by all means he/she can charge a higher fees. Sadly we live in a world where you get what you pay for.
We all can pass our exams and frame our certificates. The client is not
interested in the certificate. He/She wants to know what the lawyer can do for the client.As, you may be aware that under consumer credit act, payments made by a credit card for goods/services, if turns out to be faulty etc. The consumer is fully refunded by the credit card company. I understand that this protection has been extended to EU, as you can understand credit card companies are not making a publicity of this.
A lawyer could suggest that payment for deposit of €3 or €6k could be made by this method.
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So despite your comment “If my lawyer cannot find a legal way out of a situation, than what am I paying him or her”, you also go on to state “The lawyers job is to find a procedural/legal solution to the situation his/her clients find themselves in”.
The first is a sweeping statement and not fact, as it is possible that there is no legal way out in some circumstances.
the second statement made is again only correct if there is a “procedural/legal solution”, which again isn’t always the case.
I won’t quote specific instances and am not a lawyer. -
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The wise thing to do is to contact a Lawyer BEFORE you sign any deposit.
In any case, a non-refundable deposit can be considered an abusive clause in the contract and, therefore, contract may be reversed.
Of course, each case will need special attention & care and not all contracts may be reversed that easily. -
abolex. Your advise is valid in theory but in practise this does/did not happen. Specially when the market was very fluid.
Have you ever seen a vendor, estate Agent or a show flat having a proforma copy of the sales contract? I am not talking about an English/French/German translation’s don’t even have a Spanish one.
In, the glory days of off plan most of the purchases were carried out on a weekend inspection trips. I have never met a lawyer in Spain, who works on weekends or after lunch on Fridays, not to mention the days of puente and the absurd two hours lunch break.
I, respect a countries working practises. These practices have to be evolved with change of market and market conditions.
I, have visited various show flats. The show flats do not open before 10.00 a.m. Most staff did not turn up 10.15. By the time the staff has switched on the lights/ACs got their paper work sorted out, you will only have the opportunity to perhaps view a couple of developments. By this time it is already getting to 14.00. The lawyers by than have gone to lunch. Incidentally many of the show flat do close earlier than the hours stated on their doors and contact phones out of hours on voice mails.
So, when is a prospective buyer suppose to contact the lawyers ???? Assuming that they had established a contact with the lawyers before hand.
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When we placed our reservation deposit, we did so with our independent solicitor. We were told that under no circumstances should we pay the deposit to the builder, the agent or the agent’s recommended solicitors.
We went to our solicitor’s office and were told that by paying the fee to the solicitor, it was basically held in an Escrow account until the contracts had been received from the builders and the necessary permits and permissions. Only then would our solicitor take our money to the builder and sign a binding contract.
In our case, it took the builders nearly 3 weeks to send the contract, then it was the August shutdown, so the contract wasn’t signed and deposit handed over for nearly 8 weeks.
Mark
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“We went to our solicitor’s office and were told that by paying the fee to the solicitor, it was basically held in an Escrow account until the contracts had been received from the builders and the necessary permits and permissions. Only then would our solicitor take our money to the builder and sign a binding contract”
Markfish you were lucky and an exception that things worked out for you in practical terms. I am sure that in the mean time if another buyer wanted your property and put down the reservation deposit. The developers would have sold the property and than you would have to chase the deposit from the so called escrow account.
Sadly Good faith & my word is my bond does not apply in today’s commercial world.
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“We went to our solicitor’s office and were told that by paying the fee to the solicitor, it was basically held in an Escrow account until the contracts had been received from the builders and the necessary permits and permissions. Only then would our solicitor take our money to the builder and sign a binding contract“
That is what our lawyer told us! Complete b***s***! 👿 Many people were told this…..and we all trusted the lawyer. B I G M I S T A K E!
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Our solicitor was one that was recommended by this forum and was pretty good. He gave us a receipt for 6000€ to show our agent, even though we did not give any money to him at the time. When we got back to the UK, we sent the money by transfer to our solicitor a few weeks later ready for the contract to be signed.
We explained this to someone we met last week and were told that there are two different types of solicitor in Spain. One that wants your money up front and one that requires no payment for their services until completion, we got the latter. We paid nothing towards our fees until such times as we had completed and our builders mortgage cancellation fee had been returned to us.
These are all things we would not have been able to make sure happened had we not found this and other forums to help.
mark
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For fear of being labeled as anti Spanish Lawyers. I did not expand on the subject that Claire has touched upon.
I, would not leave a € with the solicitors. Escrow account or not ! As the legal system does not work and the lawyers are well aware of it. A self serving policy is being used by them for years.
Who is going to be responsible for my money if the lawyers misuses the funds in the escrow account ? The colegio de abagado ??
The, lawyers would be quite happy to keep the money to fund their life style or their cash flow. It may even be possible that the developer’s wait for your purchase and pass the papers onto the lawyers. The lawyers will ignore your calls, e.mails and the same from the developers and you could lose the property plus the reservation deposit.
In, conclusion and to be fair to the lawyers if the cases do not get to the Courts for years and as a result the lawyer has not been paid and has perhaps even incurred out of pocket expenses, how is he expected to support himself or his family.
The legal system is rotten to the core and need to be fully overhauled right across. This will not happen until the legal fraternity accepts the problems and deal with it in a grown up mature manner and don’t cry like a baby every time they are criticised.
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Marksfish wrote:
These are all things we would not have been able to make sure happened had we not found this and other forums to help.
Mark you were fortunate to be able to read forums such as this one. When many of us were conned, this forum and many others were not known about or in existence. The “corruption” was not uncovered until people like ourselves started making loud noises. 😉
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Hi Claire
I hear what you and Shakeel are saying, it isn’t fair however to tar every lawyer with the same brush. Not trying to play devil’s advocate here, but Maria is a valuable asset on this forum and others, I am sure she would be quite offended that people think all lawyers are crooks!! I would be happy to recommend my solicitor to anyone in theMurcia/ Almeria region.
Mark
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“I have the greatest respect for Maria & Drakan and am fully aware that not all Lawyers are bad.”
I agree with the above and I am acutely aware that Maria & Draken are doing their best to change the tarnished reputation. If only the “colegio de abagados” did a smaller percentage of what Maria & Darken has been doing. We would not be talking about the Legal profession in Spain in such dismissal manner.
“it isn’t fair however to tar every lawyer with the same brush”
I agree. Besides, I have been fortunate enough not to have lost or suffered at the hands of the triangle of developers, agents & lawyers. However if this was not the case. I would not be so understanding or pragmatic. -
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