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What is a Contrato de Arras?
“The Contrato de Arras in Mallorca – What foreign buyers should definitely know”
Many buyers who do not come from Spain are surprised when they hear about the Contrato de Arras in Spain. This document is standard in Spain when buying a property – there is nothing comparable in this form in Germany or Austria. This is why uncertainties often arise: What is this contract good for? What risks does it entail? And what should you pay particular attention to as a foreigner?
In this article, we explain step by step what the Contrato de Arras is all about – simply, clearly and with practical examples from Mallorca.
1 What is a Contrato de Arras anyway?
This is a preliminary contractwhich prepares the subsequent purchase of a property.
The buyer usually pays a deposit (usually 10% of the purchase price).
The seller and buyer already record important key points in writing: purchase price, method of payment, date of the notary appointment, assumption of costs, etc.
You could say that the Contrato de Arras is a reservation reservation with legal binding force.
Example:
You would like to buy an apartment in Palma, purchase price €400,000. You pay €40,000 as a deposit. The apartment is now reserved for you and the seller is no longer allowed to offer it to anyone else.
2 Why is this contract so important?
It gives security for both sides: The seller knows that you are seriously interested, and you know that the property will no longer be snatched from under your nose.
It regulates what happens if one party does not fulfill its obligation.
It creates a clear framework for taking care of financing and formalities in peace before the notary appointment takes place.
3 What types of Contrato de Arras are there?
Spanish law distinguishes between three types – important because the consequences are different:
The deposit is part of the purchase price.
If one party does not cooperate, the other can insist on fulfillment of the contract or demand compensation.
Arras confirmatorias (confirmatory deposit)
Most often on Mallorca!
Buyer can withdraw → loses deposit.
Seller can withdraw → must pay back double.
Arras penitenciales (revocable deposit)
Example: You pay €40,000. If you withdraw, you lose this. If the seller backs out, he must refund the €40,000 and pay a €40,000 penalty.
Arras penales (contractual penalty)
Contain a penalty clause.
Buyer or seller can insist on insist on fulfillment of the contract AND claim damages.
Rather rare in private real estate purchases.
4 What do foreign buyers need to be aware of?
Point | Explanation |
|---|---|
Language & understanding | Always have the contract translated or explained by a lawyer. A small legal mistake can be expensive. |
Clarity on deadlines | The appointment for the notary in particular must be clearly regulated. Does the contract state that you must propose the date? How and by when? |
Communication channel | In Spain, Burofax (court-proof delivery) is often used. E-mail alone is not secure. |
Allocation of costs | In Germany, the buyer usually pays almost everything – in Spain it can be different. Make sure the contract contains clear provisions. |
Financing | If you need a mortgage, clarify in advance whether your bank can finance it on time. If necessary, include an extension in the contract. |
5. how much is the deposit?
As a rule 10 % of the purchase price.
For properties in Mallorca that are in high demand (e.g. sea view apartments or fincas with a license), the seller can demand more.
Important: The deposit will be deducted from the purchase price at a later date.
6. is the Contrato de Arras binding?
Noyou could also sign the purchase contract directly at the notary.
But: In practice, the Arras contract is almost always the standard, as sellers want security before they take the property off the market.
7. tax aspects
When the purchase is finalized: The deposit is considered part of the purchase price.
If the purchase fails:
Buyer loses down payment → no tax advantage.
Seller keeps deposit → must tax this as profit.
8. practical tips for German buyers
Always consult a lawyer – ideally German-speaking and with experience in Mallorca.
Do not sign a Spanish contract without checking it! – Even small clauses can have serious consequences.
Observe deadlines precisely – especially for the notary appointment.
Payment via verification channels – Bank transfer, no cash.
Prepare documents – NEVER, NEVER forget the NIE (Spanish Alien Identification Number).
Conclusion:
The Contrato de Arras is a key document when buying a property in Mallorca. It protects both parties, but also harbors risks if you are not familiar with the legal differences to German law.
Our advice:
Always have the contract always checked legally.
Pay attention to clear formulations and realistic deadlines.
And above all: understand the consequences before you sign – then nothing will stand in the way of you buying your dream property in Mallorca.
