Off-plan financing in Spain: timetable and guarantees
Off-plan financing in Spain follows a phased payment schedule: a deposit of €3,000 to €10,000
, followed by 20 to 40 per cent of the price during construction
, and then the remaining 60 to 70 per cent on completion, including the mortgage. Every euro paid before you receive the keys must be covered by a bank guarantee or insurance bond
and deposited into a special account (Law 38/1999, Additional Provision 1, as amended by Law 20/2015). Without an individual guarantee certificate, do not pay anything. In Andalusia, add 10 per cent VAT + 1.2 per cent stamp duty
.
Updated in September 2026 — data verified on that date.
Off-plan financing in Spain: paying in instalments to the developer
Buying off-plan on the Costa del Sol means paying for a property that does not yet exist, under a legal framework that is neither the French VEFA nor the Belgian Breyne Act. The process is, however, well regulated, provided you understand what the law guarantees (the refund of your deposits) and what it does not guarantee (the completion of the development). This page details the payment schedule, the guarantees, financing the balance and the clauses to be negotiated.
Payment in instalments is one of the four financing methods covered in our guide to budgeting and financing a property purchase in Spain. To choose between new-build and second-hand properties, read our comparison of the advantages and risks of a new-build flat in Spain; here, we’re talking about money: when to pay, how much, and what protection is in place.
What is an off-plan purchase (sobre plano) in Spain?
An off-plan purchase, or ‘compra sobre plano’, refers to the purchase of a property from a developer (promotor) before or during its construction, based on the plans, a ‘memoria de calidades’ (specification of finishes) and a ‘licencia de obra’. The price is fixed at the time of booking; ownership is only transferred upon signing the escritura, following the issuance of the certificado final de obra and the licencia de primera ocupación (LPO) by the local council.
New-build properties are traded in a tight market. According to the INE’s house price index, new-build prices rose by 7.4 per cent year-on-year in the second quarter of 2026, compared with 12.9 per cent for existing properties. In Málaga, the College of Architects approved 9,475 homes in 2025 (+6.4 per cent), and its president, Susana Gómez de Lara, points out that social housing “remains negligible” in the face of ever-increasing demand (Vida Económica, January 2026).
The typical payment schedule for an off-plan property on the Costa del Sol
The standard payment schedule consists of three phases: reservation, instalments during construction, and the balance upon handover. The ‘30 per cent before handover, 70 per cent upon receipt of the keys’ arrangement is the most common in 2026, with variations of 40 per cent for high-end projects.
Day 0 · €3,000 to €10,000
The property is taken off the market; the price is fixed. This sum is deductible from the purchase price but is rarely refundable if you withdraw from the sale: have your solicitor review this clause.
15 to 30 days · 10 to 20 per cent of the price, less the reservation fee
Sets out the timetable, the handover date, the specifications (memoria de calidades), the guarantee covering instalments and penalties for late payment. Your protection depends on this.
6 to 24 months · 10 to 20 per cent in one or more instalments
Instalments on fixed dates or upon completion of construction milestones. Each payment is subject to 10 per cent VAT and must be covered by an individual guarantee certificate.
After LPO · balance of 60 to 70 per cent + 1.2 per cent stamp duty
Signing before a notary after LPO, payment of the balance (own funds or mortgage), handover of keys, registration in the land register.
Reservation fee: €6,000; private contract: €40,000 (10 per cent) minus the reservation fee, plus €4,000 VAT; two instalments of €40,000 + €4,000 VAT at 6 and 12 months; balance of €280,000 on handover, plus €28,000 VAT and €4,800 AJD. Total: €444,800 before notary, land registry and solicitor’s fees, of which €132,000 is paid before the keys are even handed over.
The 10 per cent VAT is payable with each instalment, and the 1.2 per cent AJD is payable upon registration (Law 5/2021, Regional Government of Andalusia); details of purchase costs in Spain can be found on our dedicated page.
Legal guarantees: bank guarantee, surety insurance and special account
Spanish law requires the developer, upon obtaining the building permit (licencia de edificación), to guarantee the refund of all sums paid prior to handover, including taxes, plus statutory interest, by means of a bank guarantee (aval bancario) or a surety bond (seguro de caución), and to deposit these sums into a special account (cuenta especial) separate from their own cash flow. This scheme is set out in Additional Provision 1 of the Ley 38/1999 on Building Regulations (LOE), as amended by Ley 20/2015, which has been in force since 1 January 2016.
Three practical points, summarised by the Bank of Spain: the contract must name the guarantor and the bank acting as custodian of the special account; if the developer fails to repay within 30 days of your formal notice, you may make a claim directly against the guarantor; the guarantee ceases upon the issue of the Certificate of Occupancy (LPO) and upon handover. Failure to comply is punishable by a penalty of up to 25 per cent of the sums that should have been guaranteed.
A French person thinks of a ‘financial guarantee of completion’ (VEFA), a Belgian thinks of the ‘Breyne Act’. The Spanish guarantee is neither of these: it reimburses your instalments if the development fails, but does not oblige anyone to complete the building. Insist on an individual guarantee certificate in your name for each payment, not a reference to a group policy, and have this verified by your independent solicitor before each bank transfer.
Law 38/1999 (LOE) and your rights: delays, defects, handover
The LOE and the Spanish Civil Code grant off-plan buyers specific rights, whether they are residents or not. A substantial delay (several months without completion or an LPO) entitles you to terminate the contract (Article 1124 of the Civil Code), with a refund of deposits, statutory interest and compensation for proven damages; a delay of a few weeks, where a provisional acceptance has been obtained, generally only justifies compensation.
| Protection | Legal basis | What you can demand |
|---|---|---|
| Deposits | LOE, DA 1 (Law 20/2015) | Reimbursement + statutory interest via a guarantee or surety insurance |
| Substantial delay | Civil Code, Art. 1124 | Termination of the contract, restitution, damages |
| Defects in workmanship | LOE, Art. 17 — 1 year | Repairs by the developer (list of defects on handover) |
| Habitability (waterproofing, installations) | LOE, Art. 17 — 3 years | Repairs, joint and several liability of the contractors |
| Structure | LOE, Articles 17 and 19 — 10 years | Compulsory ten-year insurance taken out by the developer |
Three clauses to be negotiated in the private contract: fixed handover date with maximum extension (three to six months), quantified penalty for delay per month, right to withhold payment of the balance in the event of a discrepancy with the memoria de calidades. The Spanish notary will not verify any of this: their role is to authenticate, not to advise.
Financing the balance on completion: mortgage, subrogation or own funds
The remaining 60 to 70 per cent is payable at the ‘escritura’ via one of three methods. A Spanish mortgage for non-residents, to be applied for three to four months before handover: the bank carries out a valuation of the completed property and finances 60 to 70 per cent of its value, which covers the balance if you have paid 30 to 40 per cent during construction. Subrogation into the developer’s loan (préstamo promotor): the bank financing the development offers to take over the portion relating to your plot, on pre-negotiated terms which may not necessarily be the most favourable. Equity, which may come from a loan secured against a property in France or Belgium, or from a cash purchase.
A project reserved in 2026 is financed at the 2028 interest rate. In June 2026, the average rate for new mortgages was 2.96 per cent (INE), but no bank guarantees this two years in advance. Calculate your borrowing capacity at 4 per cent and allow for a margin: a refusal to grant a loan upon completion does not release you from the private contract.
The risks of off-plan purchases and how to protect yourself
The risks associated with an off-plan purchase must be addressed before signing the private contract. The first is delay: the LPO, issued by the local council following the ‘certificado final de obra’, takes between three and nine months depending on the local authority, and some developments are handed over with a delay of six to twelve months. The second is the discrepancy between the plans and reality (floor areas, orientation, specifications). The third is the developer’s financial stability: a guarantee is no substitute for a sound balance sheet.
- → Building permit issued, not merely applied for
- → Land title abstract in the developer’s name, with known charges
- → Identity of the guarantor and the special account
- → Developer’s track record: completed projects, delays, legal disputes
- → Individual guarantee certificate in your name
- → Bank transfer to the special account, never to the developer’s current account
- → Actual progress of the building works verified
- → On handover: list of reservations signed before the final payment
These checks form the core of property due diligence in Spain; for a new-build project, our Property Check 360° also includes an analysis of the developer, the town planning scheme and the future residents’ association.
Buying off-plan via a buyer’s agent: the advantage of negotiation
The advertised price of a new-build development is rarely negotiated on the figure itself, but rather on the payment schedule (reduced booking fee, staggered instalments), the specifications (kitchen, air conditioning, parking), late payment penalties and who bears the costs. The developer pays the agent who brings them a buyer; NOMA, as the buyer’s agent, is paid through this commission split and negotiates on your behalf at no extra cost. Our approach: comparing several developments, both at launch and towards the end of the sales period, when the final units are most negotiable.
Off-plan financing in Spain: your questions
What happens if the developer fails to deliver?
You will recover the full amount paid, including taxes, plus statutory interest, thanks to the bank guarantee or surety insurance that Law 38/1999 requires the developer to provide as soon as the building permit is granted. You serve the developer with a formal notice; if there is no response within 30 days, you make a claim directly against the guarantor. Without an individual guarantee certificate, the claim becomes a lengthy and uncertain legal dispute.
Can you get a loan for the balance due on completion?
Yes, in two ways: a standard mortgage applied for three to four months before handover, based on the valuation of the completed property (60 to 70 per cent of the value for a non-resident), or subrogation into the developer’s loan offered by the bank that financed the construction. Compare the two: subrogation is straightforward, but its interest rate and fees are not always the best.
Are off-plan prices more attractive than the market rate?
At the launch stage, a development generally sells for 5 to 15 per cent below the price recorded on completion, an indicative range depending on the area and the developer; with new-build prices having risen by 7.4 per cent year-on-year in the second quarter of 2026 (INE), the difference is mainly due to the payment being spread over two years interest-free. Buying off-plan is as much about timing as it is about price.
A thoroughly vetted off-plan property is one of the safest purchases on the Costa del Sol; if not properly vetted, it can be one of the most expensive. Our selection of properties includes new-build developments where we have verified the developer and the guarantee.
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