Larraín Nesbitt Lawyers is a Marbella-based independent law firm specialized in property conveyancing, taxation, litigation, probate and succession. Expert native English-speaking lawyers and economists blend legal and practical advice providing tailored assistance on your matter. Our range of services cover the greater Marbella area, Sotogrande and Costa del Sol.


The firm focuses advising foreign investors on acquiring residential property in Spain both from a legal and fiscal point of view. Our no-nonsense approach to business coupled with our commitment to clients ensures easy-going transactions. We pride ourselves in putting our clients’ interests at the forefront of everything we do.


Larraín Nesbitt Lawyers, your legal partner in Spain.

Last Article:

6 things to watch out for on buying property in Spain

Raymundo Larraín Nesbitt, April, 1. 2025

Marbella-based Larraín Nesbitt Abogados (LNA) has over 22 years of experience at your service. We offer a wide range of 60 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2025. Plagiarism will be criminally prosecuted

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
1st of April 2025

Introduction

On buying property in Spain, you should be mindful the title is clean. It is fairly common the previous owner is in arrears. In Spain, the golden rule is that debts follow the property not the debtor. Meaning, when you take over ownership, you also take on the mantle of all the existing debts from the previous owner. This is why you should hire a conveyance law firm - like us - to carry out a thorough due diligence on the title ensuring everything is above board.

  1. Tenants. On buying property, the new owner takes on the position of landlord and must respect - by law - the duration of a pre-existing rental agreement. You should know some rental agreements in Spain lock you in for ten years… and you cannot update the rental.
  2. Utility invoices (water, electricity, etc). Outstanding utility invoices are a nuisance as utility companies may shut down the supplies. Reconnecting the electric supply, for example, can set you back 500 euros and you need to wait at least 4 weeks to top it off.
  3. Community of Owners. Properties within a community can be in arrears. The new owner takes on all the debts dating back five years, which can be substantial.
  4. Local taxes. The property can be in arrears with taxes levied by the local town hall. In the worst case, the property can be impounded and sold off in a public auction to recoup the debt. The new owner is held liable for all taxes going back four years.
  5. Title. It is important to acquire a clean title. Mortgages, embargoes, liens, etc can weigh down on a property’s value.
  6. Banned holiday rentals. A new trend is developing in community of owners, whereby they agree to ban holiday rentals outright. There is no point investing in a nice beach pad if you are not allowed to rent it out. It goes without saying that a property which cannot be leased legally has a substantially reduced market values as opposed to other similar properties in the area which can.

I have only listed the basic six, but you should be aware there are far more points to look out for. Which is why we strongly urge you to contact an experienced law firm like ours on buying property in Spain, especially if you are a foreigner and are unfamiliar with the buying procedure.

t Larrain Nesbitt Abogados (LNA) we have over 22 years of experience specializing in taxation, and property conveyance. We also assist clients with immigration & residency visas and inheritance procedures (probate). You can contact us by e-mail at info@larrainnesbitt.com, by telephone on our UK line (+44) 0754 3838 218 or Spanish line (+34) 952 19 22 88, or by completing our contact form.

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Ní neart go cur le chéile. VOV.

Larraín Nesbitt Abogados, small on fees, BIG on service.
2025© Raymundo Larraín Nesbitt. All Rights Reserved.

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The 6 stages of a bank repossession in Spain

Raymundo Larraín Nesbitt, April, 21. 2025

Marbella-based Larraín Nesbitt Lawyers has over 22 years' taxation & conveyancing experience at your service. We offer a wide range of over 60 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain. You can review here our client’s testimonials.

Copyrighted © 2008 and 2025. Plagiarism will be criminally prosecuted.

21st April 2025

Introduction

One possible way to acquire property in Spain is through a public auction. These properties that fall under a gavel are known in Spanish as ‘ejecuciones hipotecarias’, or bank repossessions in English.

Given how inflation remains unchecked post-Covid, central banks have steeply increased the price of money (interest rates) which in turn has translated into higher monthly repayments for millions of borrowers. Thousands of struggling borrowers have capitulated, and lenders have repossessed their property.

Bank repos are properties in which a borrower has fallen in arrears with his mortgage repayments and his lender (normally a bank) has taken back the property legally.

These properties are then sold on in public auctions for a fraction of their street value. For example, let’s say a reckless borrower by the name of Feliz Joseph fails to service his €500,000 mortgage loan. Once his lender repossesses his Mijas property, you can buy his home for under €200,000! Interested?

Although it may sound at first like a great option, there are in fact quite a few caveats that exceed the purpose of this blog post. The gist is that this option is better be left to professionals who know what they are doing and are prepared to accept steep financial losses. Bank repos are not everyone’s cup of tea and are not fit for laymen.

However, for those who are dauntless, the rewards far outstrip the risks. In effect, you are acquiring a property through a law court for half of its street value, or even less!

Given Spain’s ongoing property boom, which is now closing its fourth year, and how properties have appreciated by double digits in major cities and in selected coastal areas, bank repos offer a welcome respite to buyers and investors alike. Always an option to explore by savvy investors. You are strongly advised to retain legal counsel on following this option. Our law firm can assist you in these procedures if interested.

The six steps of a bank repossession

 

  1. The borrower falls into arrears – The borrower fails to service his mortgage repayments. Delay interests (‘intereses de mora’) accrue to cover penalties. The lender contacts the borrower and first attempts an out-of-court settlement.
  2. In technical default – Three months from the first arrear. After 3 months in arrears, a client’s file is passed onto the bank’s legal debt collection department which tries in a last-ditch effort to recover the debt. A lender will then initiate an Executive Procedure against the encumbered property.
  3. Foreclosure and notary intervention – Depending on the chances of debt recovery, 15 to 20 days after the technical default. A letter by recorded delivery is sent by a Notary Public, with acknowledgement of receipt, informing a borrower that a repossession procedure is underway.
  4. Repossession order – The court contacts the property owner to pencil a date for the trial. The judge formally notifies the borrower that his lender has instigated a repossession proceeding.
  5. The court sets a date for the public auction – Normally between 6 to 12 months after initiating the Executive Procedure. The judge sets the date of the auction. The value for auction purposes cannot fall below 75% of the appraisal value. However, if no-one bids the gavel falls and a lender is legally entitled to seize the property for 60% of its appraisal value. Should there be a guarantor in the mortgage deed the bank will chase his assets first it is easier to seize them. The property will now be registered under the name of the new owner at the Land Registry (normally the lender).
  6. Eviction – In the event the now ex-owner still dwells in the property, after a period that normally spans six months, police officers will arrive at his doorstep with a locksmith and a judicial bailiff to evict them by force, if necessary. The lender gains physical possession of the property, and the locks are changed.

At Larrain Nesbitt Abogados (LNA) we have over 21 years of experience specializing in immigration & residency visas. We also assist clients in buying, selling, or renting properties in Spain. You can contact us by e-mail at info@larrainnesbitt.com, by telephone at our UK line (+44) 0754 3838 218 or Spanish line (+34) 952 19 22 88, or by completing our contact form.

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Ní neart go cur le chéile. VOV.

Larraín Nesbitt Abogados, small on fees, BIG on service.
2008 and 2025 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Why You Must Domicile Your IBI and Rubbish Collection Tax in Spain: A Crucial Guide for Marbella Real Estate Owners

Real Marbella Estate, April, 21. 2025

Real Marbella Estate is a Marbella-based property agency. 

Run by Andy Vee and Simona Tiglar, they offer exclusive high-end properties to a discerning international client base. They publish an interesting blog which offers us a glimpse into Marbella's privileged lifestyle: Life in Marbella blog

If you are looking to buy, or sell, property in Marbella and the Costa del Sol you can contact them for a great service.

RME kindly published our article on their website: Why You Must Domicile Your IBI and Rubbish Collection Tax in Spain: A Crucial Guide for Marbella Real Estate Owners

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