*Before you read on: this article is for information only and does not constitute legal advice. Always seek independent legal advice before signing any contract.*
What Is an Arras Contract?
An arras contract (*contrato de arras*) is a private purchase agreement between buyer and seller. It is signed before the final deed of sale (*escritura pública*) at the notary — typically weeks or months earlier — once both parties have agreed on price and want to secure the deal while legalities, surveys, and financing are arranged.
The contract does two things simultaneously: it takes the property off the market, and it creates financial consequences if either party backs out.
You do not become the legal owner when you sign arras. You become contractually committed to completing the purchase on the agreed terms within the agreed timeframe.
The Three Types of Arras Contract in Spain — and Why the Difference Matters
Not all arras contracts work the same way. There are three distinct types with very different consequences.
Arras Penitenciales
The most common type in residential transactions, backed by Article 1454 of the Spanish Civil Code. Either party can walk away — but at a cost:
- If the buyer withdraws: they forfeit the deposit entirely.
- If the seller withdraws: they must return double the deposit to the buyer.
Arras Confirmatorias
The deposit serves as part-payment of the purchase price and confirms a binding purchase agreement. There is no right of withdrawal built in. If either party backs out, the other can sue for specific performance — forcing the sale to complete — or claim damages.
This means if your mortgage falls through, the seller can take you to court to force completion, not just keep your deposit.
Arras Penales
Combine elements of the other two. The deposit is advance payment and withdrawal triggers a penalty set out in the contract itself. Rare in residential contexts.
The practical upshot: Always ensure your arras contract states explicitly that it operates under Article 1454 of the Civil Code as arras penitenciales. If it does not, get a lawyer to review it before you sign.
What the Arras Contract Must Include
- Identification of the parties — full legal names, passport or NIE numbers, addresses
- Full property description — address and catastral reference number (*referencia catastral*)
- Agreed purchase price — the total price; never agree to declare a lower price at the notary
- Deposit amount — typically 10% but negotiable
- Type of arras — explicitly arras penitenciales under Article 1454
- Completion date — the deadline for the full sale to complete at the notary
- Conditions — subject to mortgage approval, clean nota simple, resolution of outstanding debts
- What is included — furniture, white goods, air conditioning units
How Much Deposit? The 10% Convention Explained
The 10% figure is a convention, not a legal requirement. You might push for less if:
- You are buying off-plan and the development is at an early stage
- You are awaiting mortgage approval and don't want a large sum at risk
- The seller is motivated and you have negotiating leverage
The Timeline Between Arras and Completion — and What Can Go Wrong
Mortgage delays. Non-resident mortgages take 6–10 weeks minimum. Build this into your completion deadline and include a mortgage condition clause. See our guide to Spanish mortgages for non-residents for typical timelines and what lenders require.
Title issues. The nota simple may reveal debts, planning infractions, or boundary disputes. Your lawyer should review the nota simple before you sign arras, not after. Our Spain property due diligence guide covers exactly what to look for.
Community debt. Unpaid community fees (*cuotas de comunidad*) transfer with the sale. Confirm in writing that there are none outstanding.
IBI arrears. Outstanding IBI (Spanish property tax) also attaches to the property. Request the latest receipt and check no years are outstanding.
Seller-side problems. Sellers can face divorce, bankruptcy, or legal proceedings during the arras period. Know exactly who you are buying from.
Can You Negotiate Arras Terms?
Yes, and you should. Everything is negotiable. The terms that most commonly benefit buyers:
A mortgage condition clause. Allows you to withdraw and recover your deposit if your application is declined. Do not sign arras without either confirmed mortgage approval or this clause in place.
A longer completion period. Standard arras allow 30–60 days. For non-resident mortgages or NIE processing, push for 90 days.
A surveyor condition. You can include a clause allowing withdrawal if a structural survey reveals serious defects.
Reduction of the deposit. Particularly relevant if you are relying on unconfirmed mortgage funds.
Arras Contract Red Flags: What to Watch For Before Signing
- No type of arras specified — if Article 1454 is not referenced, you may face harsher consequences than expected
- Seller does not appear on the land registry — run a nota simple check (€10, takes 10 minutes) via the Registro de la Propiedad before signing anything
- Outstanding debts or charges on the property — the nota simple shows all registered mortgages, liens, and charges
- Pressure to sign quickly — "there's another buyer" is a tactic; take the time to get legal review
- Unclear catastral reference — if the property description lacks this, you cannot be certain what you are buying
- Agent acting for both parties — in Spain, agents represent the seller; get independent legal representation
What Happens If the Seller Cancels?
Under arras penitenciales, if the seller pulls out for any reason, they owe you double your deposit. If you paid €30,000, they must return €60,000.
In practice, recovery may require legal action if the seller refuses. This is unusual for reputable sellers but it happens. A lawyer who has reviewed the contract makes recovery far simpler.
Note: "pulling out" must be unilateral and unjustified. If the seller can show you breached the contract first — missing the completion deadline, for example — the double-return obligation may not apply.
Do You Need a Lawyer Before Signing Arras?
Yes. Unambiguously, yes.
The arras contract is the most financially exposed moment of the purchase process. You should also factor in all the buying costs before you commit to a price. A Spanish property lawyer (*abogado*) should:
- Run a nota simple check on the property before you sign
- Review the contract and confirm the type of arras is correctly specified
- Check for outstanding debts (IBI, community fees, utilities)
- Advise on conditions to add given your circumstances
- Confirm the seller has legal authority to sell
The Bottom Line on Signing an Arras Contract in Spain
The arras contract is where the Spanish property purchase becomes real — and where foreign buyers most often make expensive mistakes. Signing without understanding what type of arras you are agreeing to, or without a lawyer checking the property's legal status, is how people lose deposits they did not need to lose.
A motivated seller will give you time to have the contract reviewed. A seller who will not allow 48 hours for legal advice should make you nervous.
Get the contract reviewed. Confirm the title is clean. Understand your exit rights. Then sign.
Frequently Asked Questions: The Arras Contract in Spain
What is an arras contract in Spain? An arras contract (*contrato de arras*) is a private pre-purchase agreement signed between buyer and seller before the final deed at the notary. It commits both parties to the sale at the agreed price and creates financial penalties for withdrawal — typically the buyer loses their deposit, and a seller who pulls out must return double.
How much is the arras deposit in Spain? The convention is 10% of the purchase price, but this is negotiable — not a legal requirement. Buyers awaiting mortgage approval, or buying off-plan, should try to negotiate a lower deposit or include a mortgage condition clause. Always pay by bank transfer, not cash, and retain proof.
What happens if the seller pulls out of the arras contract? Under arras penitenciales (the most common type), if the seller withdraws without valid justification, they must return double your deposit. If you paid €25,000, they owe you €50,000. Recovery may require legal action if the seller refuses — another reason to have a solicitor involved from the start.
Can you pull out of an arras contract in Spain? Under arras penitenciales, yes — but you forfeit your deposit. Under arras confirmatorias, withdrawal is not a built-in right: the other party can sue for specific performance or damages. Always confirm your contract explicitly states Article 1454 of the Civil Code (arras penitenciales) before signing.
Do I need a lawyer before signing an arras contract? Yes. The arras is the most financially exposed moment of the purchase. Your solicitor should run a nota simple check, confirm the type of arras is correctly specified, verify no outstanding debts attach to the property, and advise on protective conditions to include.
How long between arras and completion in Spain? Typically 30–90 days, though this is negotiable. Non-resident buyers needing mortgage approval should push for at least 90 days and include a mortgage condition clause allowing withdrawal if the application is declined.
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*This article is for information purposes only and does not constitute legal advice. Property law in Spain varies and individual circumstances differ. Always seek independent legal advice before signing any contract.*
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