Arras are a key element in the process of buying property in Spain. They designate a preliminary contract in which buyer and seller commit to the transaction.
What is an arras contract?
This is a private contract signed between the buyer and seller once they have defined the terms of the real estate transaction. The document establishes :
- Mutual commitment: the buyer reserves the property and the seller undertakes not to sell it to a third party. The arras contract thus secures the transaction in the event of an unjustified withdrawal by one of the parties.
- The payment of a deposit called Señal(click here to find out more about Señal) by the buyer. This represents between 3% and 10% of the property price.
In practice, you have two options: sign a "contrato de arras" (sales agreement) directly, or go through a "contrato de reserva " (reservation agreement) first. In both cases, it is customary to pay an amount known as the "señal" (pledge) or "reserva " (reservation) at the time of the offer to purchase. This amount, generally between €1,000 and €5,000, serves to demonstrate the seriousness and credibility of your offer.
What are the different types of arras contracts?
There are three types of arras contracts in Spain:
- Arras confirmatorias: the contract is binding on both parties, with no possibility of unilateral withdrawal. Legal recourse is necessary in the event of a dispute. The deposit paid serves as a down-payment on the sale price.
- Arras penales: these are designed to guarantee the future sales contract, and provide for compensation if the transaction is not carried out according to the agreed terms. They require compliance with the agreement and are regulated by the French Civil Code (article 1152).
- Les arras penitenciales : this is the most common type of arras contract. It allows either party to withdraw from the contract in return for compensation.
- If the buyer withdraws, he loses his deposit (la Señal).
- If the seller withdraws, he must refund double the deposit.
What information must the arras contract contain?
- Identity of buyer and seller.
- Property description.
- Sales price.
- Señal (deposit): between 3% and 10% of the property price.
- Deadline for the final deed of sale: usually between 1 and 3 months.
- Consequences of non-compliance.
Advice from the experts at Terreta Spain
- Check the legal status of the property.
- Be clear about the deadlines in the contract.
- Plan a negotiated exit and opt for arras penitenciales.
- We advise you to sign your arras contract before a notary, to benefit from supervision by a competent authority and to be able to add specific clauses.
- Have the contract checked by a real estate lawyer if you don't sign it before a notary.
How do you get an arras contract?
- If you sign at a notary's office, he will supply the contract.
- If you don't sign before a notary, the real estate agency will provide you with the contract.
FAQ : Stops in the process of buying real estate in Spain
What is an arras contract?
A contrat d'arras is a private agreement between buyer and seller that commits both parties to a real estate transaction. The buyer reserves the property and pays a deposit (the Señal), equivalent to between 3% and 10% of the property price, while the seller undertakes not to sell to a third party.
What are the different types of arras contracts in Spain?
Arras confirmatorias: firm commitment by both parties, with no possibility of unilateral withdrawal.
Arras penales: provide for compensation in the event of non-compliance, but oblige to respect the agreement unless otherwise specified.
Arras penitenciales: allow withdrawal in return for compensation (buyer forfeits deposit, seller reimburses double).
What should an arras contract contain?
- Consequences of non-compliance.
- The identity of the parties (buyer and seller).
- Description of the property.
- The sales price and the amount of the Señal (3% to 10% of the price).
- The deadline for the final deed of sale (usually 1 to 3 months).
