Buying in a Community of Owners – outstanding debts!

Raymundo Larraín Nesbitt, October, 1. 2017

By Raymundo Larraín Nesbitt
Lawyer – Abogado
21st of September 2017


Did you know that on buying in what is known as a community of owners (residential development) you could be held liable for the previous owner’s debts?

In Spain, a property is held liable for the debts of the current year plus the previous three years. So, whomever becomes the new owner 'inherits' the debt. Some community of owners, particularly those dotting the costas with lush tropical gardens and 24 hours concierge service, have steep maintenance fees; the arrears over time can be quite substantial.

For example, Mr Jones buys into a development in October 2017 without a lawyer and, unbeknownst to him, the seller is in arrears since 2013. After completion, Mr Jones moves into his new property and as a ‘welcome pack’ receives a nasty letter from the community Administrator threatening legal action as his property owes the community €21,000 (years 2014 through to 2017). The seller is a non-resident and already fled Spain (with the sales proceeds)!

If Mr Jones refuses to pay the debt, the community will approve in a General Assembly to instigate legal proceedings against him, placing a charge against his new property for the debt plus all the associated procedural expenses (easily a further €10,000 in legal fees). If he still does not pay, the community may auction off his property to recover the debt. Properties in Spain can be publicly auctioned off for small debts of only a couple thousand euros.

This is but one of many checks that a conveyancing lawyer will do on your behalf. If you are buying property in Spain, do it safely, hire an experienced law firm such as ours to safeguard your interests.

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