How does a reservation agreement differ from a deposit agreement (“contrato de arras”)?

Question

José Manuel Alburquerque · Accepted Answer

A reservation is a document that the prospective buyer usually signs with the estate agent so that the flat is taken off the market for a few days while the seller decides whether to accept the offer. It is not governed by any law, so what the document says is what counts. A deposit agreement (“contrato de arras”), on the other hand, is a contract between the buyer and the seller, governed by law, that commits the parties to the sale and sets out its terms and the date of the public deed. A reservation that the seller also signs may end up being treated as a deposit agreement, so read carefully what you sign. The differences The reservation is normally signed by the prospective buyer and the estate agent. Often the seller does not sign it. The deposit agreement is signed by the buyer and the seller, or by someone holding a power of attorney from them. The reservation gives the seller time to consider the offer without the flat being offered to anyone else. The deposit agreement serves to commit the parties to the sale and to set the price, the payments, the conditions and the date of the public deed. The reservation money is held in safekeeping by the estate agent. The money paid under the deposit agreement goes to the seller, unless it is agreed that someone else, such as the estate agent, will hold it. The reservation is usually a few thousand euros and the deposit between 5 % and 10 % of the price. These figures come from practice, not from the law. If the seller does not accept the offer, the reservation must be returned in full. With a deposit agreement this question does not arise, because the seller has already signed. The name is not decisive What counts is what the document says, not what it is called. If the seller signs the acceptance of the reservation and the document already specifies the flat and the price, it may already amount to a sale. In addition, in Catalonia the law treats money that the buyer hands over to the seller as a confirmatory deposit (“arras confirmatorias”), the type that obliges both parties to buy and to sell. That is why a reservation accepted by the seller and paid on account of the price runs the risk of being treated as that type of deposit. If you do not want to be bound to buy yet, the document must state clearly what happens if you pull out after the acceptance. Before paying a reservation Ask for a written receipt stating who you are paying and what for, how long the offer is valid, that the money will be returned to you in full if the seller does not accept within that period and what happens if you pull out afterwards. Check that the estate agent is entered in the “Registre d'Agents Immobiliaris de Catalunya”, the Catalan register of estate agents, which can be consulted on the website of the “Agència de l'Habitatge de Catalunya”, the Catalan housing agency. Agencies are required to have a guarantee covering the money they receive until they hand it over to the person entitled to it.