In this article
What it is
A private contract signed before the deed, where the buyer pays a deposit (commonly around 10 %) and both parties set the price and deadline for completion.
The three types
- Penitenciales: either party can withdraw; the buyer loses the deposit or the seller returns double. Most common.
- Confirmatorias: deposit is an advance; breach allows claiming performance or damages.
- Penales: deposit as penalty, plus the right to demand performance.
Before signing
- Nota simple and community debt certificate.
- A home inspection in Madrid to know the condition.
- A clause covering mortgage refusal if you need financing.
Get advice
Many foreign buyers ask a lawyer or notary to review the contract. Spanish guide: contrato de arras.
Common pitfalls
- Signing before checking the nota simple or the property condition.
- Vague wording that does not specify the arras type.
- No clause for mortgage refusal.
- Not stating who pays pending community levies.
Paying the deposit
Pay by bank transfer to an account in the seller’s name or to an agreed escrow. Never in cash. Keep proof of payment for completion.
FAQ
Can I get my deposit back?
With arras penitenciales, generally not if you withdraw, unless agreed conditions apply.
Who holds the deposit?
The seller or the agency; specify it in the contract.
Is it signed at a notary?
Not necessarily; it is a private contract.
How long until completion?
Usually one to three months.