The first document in a Mallorca purchase is often described as ‘only a reservation’. Its length does not determine its importance. A one-page form can set a price, deadline, deposit and default consequence before the buyer has received the documents needed to assess the property.
Key points for the buyer
- Have the reservation reviewed before transferring money.
- State where funds are held and when they are refundable.
- Do not rely on the word arras without analysing the clause.
- Make unresolved due diligence and finance express conditions.
What a reservation agreement should achieve
A sensible reservation identifies the buyer, seller and exact property, records the proposed price, gives a short exclusivity period and sets a protected timetable for legal checks. It should identify the recipient and holder of the money and prevent release to the seller while agreed conditions remain open.
If the seller has not yet accepted, the form should explain what happens. If acceptance depends on countersignature or another event, the deposit should not drift into an uncertain status.
When the deposit must be refundable
Refund provisions should cover the results that matter to the buyer: unacceptable title, material planning defects, inability to obtain agreed finance, failure to provide defined documents or another specific condition. Vague wording such as ‘subject to legal checks’ can produce an argument over what counts as unsatisfactory.
The lawyer should have enough time to obtain evidence from the registry, municipality, community and seller. A deadline that expires before those responses can realistically arrive undermines the protection.
Before you pay the deposit
Send us the property listing or the document you have been asked to sign.
Understanding arras
Spanish contracts use deposits in different legal ways. In a properly structured withdrawal arrangement, one party may lose the amount paid or the seller may have to return double. In other arrangements, the deposit confirms a binding sale and the innocent party may seek performance or damages. The entire contract—not the heading—determines the effect.
Buyers should not assume that losing the deposit is always the maximum downside, or that double repayment is automatic. The clause, governing law and surrounding obligations need to be read together.
Terms to settle before the private contract
The parties should resolve the completion date, inclusions, vacant possession, mortgage cancellation, community and tax debts, planning documents, apportionments, condition of the property and consequences of default. If the seller promises to correct a title or planning issue, define the evidence and deadline.
Foreign buyers should also align the contract with NIE timing, power of attorney, bank compliance and the route for transferring the completion funds.
What to do if you have already signed
Send the signed document and payment evidence to an independent lawyer immediately. Do not sign an extension or second contract to ‘fix’ the first before the legal position is understood. Preserve messages and marketing statements that explain what was represented.
Often the practical solution is to negotiate clearer conditions into the next agreement. Whether the buyer can demand a refund depends on the wording, facts and applicable law, so obtain transaction-specific advice.
Official sources and further reading
This guide uses primary official sources. Rules and administrative practice can change, so the position should be checked for the exact property and date.
- Spanish Land Registry — information for property buyers ↗
- BOE — Balearic Islands Urban Planning Act 12/2017 ↗
Important
This article provides general information, not legal or tax advice. Property title, planning, tax and contract outcomes depend on the documents, location, dates and parties in the individual transaction.