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Financial Dictionary - Deed of sale
Deed of sale
The public deed of sale is a document that is registered in the Property Registry, and as such it proves that the property exists legally; it also confirms that the property is free of occupants and charges, and shows the willingness of both parties to comply with the agreement.
It means that both parties agree and will record their agreement before a notary; as such it is the last step in the process before we register our property in the Property Registry
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Although the deed of sale is not compulsory, it is highly recommended. Why? Because we will have the peace of mind of knowing that legally everything has been done properly, avoiding possible complications in the future. Nor is it overly expensive (it will cost €300 at most). It is a better idea than simply signing a private agreement, which is not legal and may not necessarily be beneficial for both parties.
More specifically, if the buyer registers the property they will have proof they are the only owner, and will have all rights to the property; they will be protected against possible creditors of the seller, and against possible third parties who might also have a claim on the property; it will prove that the seller is legitimate, as we can view their details in the registry.
What does a deed of sale prove?
According to the deed of sale, the seller must have fulfilled the following requirements (on top of those described above):
- They must have paid all outstanding property owners’ association fees.
- They will have to submit the last receipt they have paid for property tax. The buyer’s details will also be submitted to the Property Registry, so that from that point on this tax will be paid by the buyer.
- The energy efficiency certificate and the occupancy certificate.
- The seller will be obliged to comply with any tax-related or legal obligations.
- The deed will also guarantee that both parties agree about the terms and conditions of payment, for the apportionment of costs and the settlement of notary fees.
The notary will read the deed to us, explain anything we need to know, and, above all, will attest to everything we sign. When the meeting is over, we will be given the keys and the licence of first occupation so that we can arrange to pay utilities. We will also be given a simple copy of the deed so that we can include it in our income tax return.
Selling a property without a deed
It is certainly possible to do so (the deed or public instrument is not mandatory), though, as certain information will be missing, it may cause us some problems in the future. remember that with the public instrument, the seller must necessarily submit all the required documents to be able to sell their property.