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The first step is to establish the existence of a Spanish will.
The Central Registry of Spanish Wills in Madrid should be contacted. If a will exists, the deceased’s death certificate will be required in order to apply for a legal copy of the Spanish will.
A valuation of the deceased’s estate in Spain will also be required.
If there is a Spanish will, then proceed with the administration of the estate in Spain. Only a notarised and apostilled copy of the death certificate is required.
If there is only a foreign will or intestacy, the following documents will have to be translated, notarised and apostilled, before the administration of the estate in Spain can proceed:
The legal formalities of transferring property to beneficiaries in Spain are completed before a Spanish Notary.
When facing repossession in Spain the situation does seem impossible and obviously is incredibly stressful. The obvious and most common response is to go into a head-in-the-sand state of denial hoping that things will somehow improve. Sometimes you may be lucky and it does but most of the time not facing the reality of impending repossession in Spain only serves to make things worse.
The first and most important step is to talk to your Spanish bank as quickly as you can as it is possible to negotiate with them as long as you are not more than three months in mortgage arrears.
Before that time options to avoid being repossessed could include handing in the keys or extending the mortgage over a longer period thus reducing the repayments or making the mortgage interest only. These however are short-term fixes because obviously you still have to make the new lower monthly repayments, plus over the long-term you will have to pay much more for the loan or with interest only, at the end of the mortgage you would still have to pay back to the bank the capital.
If you bought your property in Spain a long time ago and it has gone up in value then you may well be able to just hand in the keys if you can’t keep up with your mortgage repayments because the bank will be able to take back the property and sell it at auction and still recoup the amount still owed – however that is not going to be the case if the property has negative equity.
With property prices in Spain in steep decline, more and more property is slipping into negative equity. Generally the peak in Spanish property prices is acknowledged as 2004. Buying then or after and you are likely to be in negative equity.
If the bank repossesses your property and then the bank sell it for less than you still owe them, then you are liable for the difference even if you leave Spain – the bank can (and now typically does) chase you in your home country.