Deposit Protection
Can You Lose Your Deposit Buying in Spain?
Learn when you're legally locked in, what to check before signing the arras contract, and how to protect your deposit as a first-time buyer in Spain.
How Deposits Work in Spain
Buying property abroad is nerve-wracking enough without worrying about losing tens of thousands of euros. If you're looking at Spain for the first time, the deposit question is probably on your mind: what happens if something goes wrong after I've handed over 10% of the purchase price?
Here's the direct answer: yes, you can lose your deposit. But only in specific, preventable circumstances. Spanish property law is clear about when you become committed and when you're still free to walk away. Follow the right steps in the right order, and you won't be the buyer who gets caught out.
There are two separate payments before completion. The first is a reservation or booking fee, typically 1–3% of the purchase price. This holds the property off the market for 7–14 days while you instruct your lawyer and start due diligence. If you walk away at this stage, you lose the reservation fee, but there are no further legal consequences.
Then comes the arras contract. You pay a deposit of around 10% and sign a legally binding agreement. If you pull out after signing without legal justification, you forfeit the full 10%. If the seller pulls out, they must return double the deposit to you. Most buyers who lose money here didn't understand that the arras was the line they couldn't uncross.
When You're Legally Locked In
Reservation Fee (Days 1–14)
You pay 1–3% to hold the property off the market. This is not legally binding. You can walk away, losing only the fee. Use this window to instruct an independent lawyer, order the Nota Simple, and begin all your due diligence.
Arras Contract (Days 14–30)
You pay 10% and sign the arras contract. This is the point of no return. Every check must be done before this signature: title search, debt verification, written mortgage approval, and planning permission confirmation.
Notary Deed / Escritura (Days 30–90)
You sign the deed at the notary and pay the remaining balance. You're now the legal owner. Pulling out here is practically impossible and carries serious financial and legal consequences.
All due diligence happens between the reservation fee and the arras signing. That window of 7–14 days is when your lawyer does the heavy lifting: ordering the Nota Simple, checking for debts, verifying planning permissions, and confirming your mortgage in writing.
If your lawyer hasn't finished their checks by the arras deadline, don't sign. Push the date back. A reasonable seller will understand. A seller who pressures you to sign before checks are complete is itself a warning sign. Your lawyer should tell you when it's safe to proceed, and when it isn't.
Free Consultation
Book a Free 60-Minute Lawyer Consultation
Not sure what to check before signing? Speak with an independent Spanish property lawyer for free. Ask about the Nota Simple, arras contract, debts, permits — anything on your mind.
Book Free ConsultationMistakes That Cost Deposits
No Title Search
A buyer signed the arras without checking ownership records. The property had an undisclosed €50,000 mortgage. The buyer pulled out and lost the deposit. Always get the Nota Simple checked first.
Unpaid Debts Transferred
A buyer trusted the seller's assurances. After completion, €15,000 in unpaid community fees transferred to the new owner. An independent check would have caught this immediately.
No Written Mortgage Approval
The bank approved the mortgage verbally. After the arras was signed, they withdrew the offer. Without written confirmation before signing, the buyer lost the deposit with no legal recourse.
No Planning Permission Check
A property had existed for 20 years, so the buyer assumed it was legal. It was built without permits. When the council served an enforcement notice, the buyer pulled out and lost the deposit.
Each of these situations has the same root cause: the buyer committed before their lawyer finished checking. An independent Spanish property lawyer should handle all of this before you sign. Their job is to verify ownership via the Nota Simple, confirm there are no outstanding debts or charges, check planning permissions, and review every clause in the arras contract.
One thing that catches many British and Northern European buyers off guard: Spain has no statutory cooling-off period for property purchases. Once you sign the arras, there's no 14-day window to change your mind. The only exception is if a withdrawal clause (cláusula de desistimiento) is explicitly negotiated and written into the contract before signing. Most standard arras contracts don't include one.
The arras is your last checkpoint. Before you sign, make sure your lawyer has confirmed everything in writing and you have written mortgage approval from your bank. Read our first-time buyer guide for the full purchase process, or see our legal requirements guide for more detail on what your lawyer should verify.
