Buyer’s guide: how to purchase with Solvia.

Index General Considerations Steps to take when buying a Property 1 Find your opportunity 2 Contact us 3 Visit the Property 4 Completion 5 Public Deed of Sale and handing over Keys INTERNATIONAL CLIENT 1 NIE Processing 2 Opening an account 3 Taxes 4 Taxation following purchase 5 Entry at the Property Register 6 Investors 7 Necessary documents (Financing) FINANCING 1 Financing Terms 2 Transparency order 3 Costs associated with a mortgage agreement 4 Sale completion - financing centre 5 Mortgage offer UTILITIES IN SPAIN 1 Electricity 2 Gas 3 Water ANNEX 1 Historical evolution of the EURIBOR 2 Monthly Repayment table for each € 10,000 3 Essential documents for processing financing

General Considerations SOLVIA offers you the chance to find the opportunity you’ve been looking for, with discounts on both our newbuild and second-hand homes, special conditions and financing of up to 70% of the property price. Steps to take when buying a Property 1. Find your opportunity SOLVIA places an extensive portfolio of new-build and repossessed properties all over Spain at your disposal. Please take a look at our website www.solviarealestate.com to check out the different options. Under repossessed properties the bank ensures the payment of any obligation not paid by the subject, when there are any doubts about the future satisfaction of the debt. 2. Contact us If you are interested in any of our properties please get in touch with us. a)

Through the contact form that you will find on our website www.solviarealestate.com.

b)

By calling our toll-free international telephone numbers from abroad.



UK: 0800 389 4301 Germany: 0800 723 8830 Italy: 1800946341 Sweden: 020100568 Russia: 810 800 25951044 Norway: 80056989 France: 0805542547 Denmark: 80251624

Our Customer Service is available from Monday to Friday, 08:00 to 20:00 hours (ECT). We speak your language: Spanish

German

English

Italian

French

Rusian

3. Visit the property Would you like to visit one of our properties? Please let us know and we will contact you to arrange the visit. 4. Completion

4.1. Purchase application

To reserve the property you will need to fill out the “Purchase Application” form. This document, (not binding), does not grant you any reservation rights over the property concerned, until SOLVIA informs you of their acceptance of the application. Your sales agent, who will be with you throughout the purchase procedure, will let you know. In order to present an offer for a property, it is an essential requirement that you make an advance payment of five hundred Euros (€ 500) as a token of interest. (This amount will be returned in the event of your asking for the cancellation of the application or of Solvia deciding not to proceed with acceptance of your offer). Payment of this amount can be made either by bank transfer (your agent will inform you about the corresponding account details), or by credit card (if the agent has the Solvia PTQ).

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This amount will be returned if you ask for cancelation of the Application.

What does “Transparency Period” mean?

A transparency period of 8 days is given for newly-published properties and for those whose price has been modified or which are included in any of our campaigns. Offers recorded during these 8 days will not be automatically accepted. They will remain until the transparency period has concluded and, after this, should there be more than one offer recorded, there will be a sealed-bid auction with a notary’s supervision. This period is implemented in all the second-hand properties or new developments with fewer than 10 units, placed in www.solviarealestate.com, in the properties description, in the “DATOS” section, marked as “Inmueble sujeto a periodo de transparencia”. Properties may be covered by a Purchase Application made by anyone interested in acquiring them, although with regard to criteria of transparency and equality of conditions between clients, no definitive acceptance of the Purchase Application will be understood until the stipulated term of eight days has elapsed. If two or more purchase applications have been presented with regard to a property that you are interested in during this period, then the Bank will go ahead and hold a sealed-bid, or first-price auction supervised by a Notary, in accordance with the terms of the sealed-bid auction, which you can consult at Solvia’s web site, www.solviarealestate.com. If this is the case your agent will inform you and send you all the documentation that you need to participate in the auction process.

4.2. Signing the Contract

Once your purchase application is accepted we will sign a private purchase contract and proceed with the payment of 10% of the agreed purchase price. The € 500 will be considered as a part of the required payment of 10%. Should you not be awarded the property at the auction, the deposit of € 500 will be refunded to you, and your application will be on the waiting list of the auction, i.e. if the awardee waives the purchase, your application would be positioned on the waiting list. The 10% will have to be transferred to Solvia’s Bank account (details of the account in the purchase contract) within a term of 8 days. If SOLVIA is not able to confirm the receipt of the 10% payment, the agreement will be declared legally null and void, with the consequent loss of any rights that may be held over the property. Likewise, whatever amounts have been paid on account, without the prior formalisation of the agreement, will be considered not due and consequently be returned. The sum of 10% paid on account will be understood as a down payment, or payment on account for the full price. The purchase contract stipulates the terms and obligations of both parties, as well as a maximum term for signing the Title deeds. 5. Public Deed of Sale, notary’s fees and handing over keys All expenses and taxes generated through the sale will be paid by the buyer, except for the increase in the value of Urban Land (plusvalía), which will be paid by the seller. As a last step we will sign the title deeds at the notary’s and you will get the keys of your new property. In accordance with the implementing regulation, the buyer will be entitled to select the Notary. In spite of the above, the buyer may not impose a Notary whose territorial competence means that they may lack reasonable connexion with some of the personal or real estate aspects of the business.

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International client 1. NIE Processing: Obtaining the NIE Foreign people interested in purchasing a property in Spain, must, for their identification, have a personal, sequential and exclusive number, called “Número de Identidad del Extranjero (NIE)”. The NIE will be the identifier of the foreign person which should appear in all the paperwork which will be delivered or processed to him/her. For the assignment of the NIE due to economic, professional or social interests, the following applications will be accepted: • The ones presented in Spain by the applicant. • The ones presented in Spain by the representative. • The ones presented in the Diplomatic Representations or Spanish Consulate Offices located in the residence country of the applicant. To obtain the NIE you can apply directly at the Dirección General de la Policía in Spain, or in the event of your not being in Spain when you need to apply, at the Embassy or Consulates. Documents to be produced: • EX-15 Application form signed and properly completed by the applicant. • Original and copy of the valid Passport, or personal ID, or travel document . • Communication of the economic, professional or social reasons justifying the application. • If the NIE is applied for by a representative, a power of attorney will be required. When you are applying for the NIE the proper fee must be paid in the stipulated form (by transfer or by cash), depending where you are applying. Don’ worry! Your agent will advise you about this! Every non-Community Public document must first be legalized, and if necessary translated into Spanish or any other co-official language where the application is delivered. 2. Opening an account Once the client has got his/her NIE, the client should go and open an account with Banco Sabadell (or any other bank). The following requirements are normally made: For residents: • Valid Passport + NIE (Foreign identification number). For non-Residents: • Valid Passport + NIE. • Valid Passport + statement of exoneration from the responsibility of communicating the NIE + Statement of non-residency. 3. Taxes The fee when purchasing a property is calculated over the price described on the deed document. Please note that if this price is lower than the real price (market price) the Tax office will ask the client for complementary tax for the difference. This fee will be different depending on it is a new property or a second-hand one.

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3.1. Taxes when buying a Newly-built Property

• IVA (VAT). Depending on the type of property and the Autonomous community*. • Stamp duty Tax depending directly on the Autonomous Community; from 0.3% to 2% of the sales price. Paid in an official document through a Bank.

3.2. Taxes when buying a second-hand property

• Tax on property transfers which is paid to the autonomous community where the property is purchased. The value of this tax is calculated depending on the autonomous community, at a percentage between 6% and 11%. 4. Taxation following purchase Annual expenses: • Spanish Property Tax (IBI), paid to the town council where your property is registered. • Non-Resident Income Tax (annual declaration). • Local Rates (rubbish collection, etc.). • Community fees. • Any other expense that could be incurred under the rules of the implemented regulation at any time when this may be approved subsequently to the issue of this buyer’s guide. 5. Entry at the Property Register Once the deed of sale and the deed of mortgage-loan1 are signed and the taxes are paid, the registration of the new right acquired has to be registered at the property register. What is the procedure? The buyer has to present at the property register: • An authorized copy of the public sales deed. • Document accrediting payment of taxes. These documents can be presented either: • By the buyer. • By an Agency. • By the notary, if they provide this kind of service. According to current legislation, once the paperwork has been presented in the property register, the registrant has up to 15 days to register the new property. 6. Investors Residency for investors making a significant investment in Spain.

6.1. Residency Visa for investors

In accordance with what is laid down in Act 14/2013 of September 27th supporting entrepreneurs and their internationalisation (hereinafter known as Act 14/2013), any non-resident foreigners aiming to come over to * In the Canary Islands this will be the Indirect Canary General Tax (IGIC), and in Ceuta and Melilla it will be the Production, Services and Import (IPSI). 1 See annex 3 and further parts of this buyer’s guide where the steps for obtaining the mortgage are explained.

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Spain to make a significant investment, that is to say the acquisition of real estate assets in Spain with a value of € 500,000 or more, amongst others, could apply for residency visa for investors. To get this visa, the investor has to accredit all the requirements laid down in Section 62 of Act 14/2013. The residency visa will enable investors (and his/her spouse and his/her children under 18 years old) to reside in Spain for a period of at least 1 year.

6.2. Residency authorisation for investors

Those investors aiming to reside in Spain for a period longer than the validity of the visa referred to in the previous section 6.1 could apply for an authorisation of residency for investors. Additionally to the general requirements of Section 62 of Act 14/2013, to apply for authorisation for residency, the investor has to accredit that he/she: • Has a valid residency visa for investors (or that 90 days from its expiry date have not yet elapsed). • Continues to be the owner of real estate for the minimum amount required. • Travelled to Spain at least once during the authorised period to reside. • Complied with the tax and social security liabilities, as applicable. The initial investor residency authorisation will last 2 years, renewable at the investor’s request. 7. Necessary documents when getting a mortgage2 The documents that need to be presented will depend on the tax residency of the applicants and their source of income. The passport and the NIE are needed. The documents have to be presented with a legal and certified translation, if the languages are not English, French or Italian. In order to proceed with the mortgage agreement, it is compulsory to open an account at Sabadell Bank. Financing 1. Important financing terms We advise you to check the list of terms below, which it is important for you to be familiar with: • Loan: An agreement by which one of the parties (the Bank) hands over to the other (the Client) a sum of money, with the obligation for the said sum to be returned within a period of time determined in the said loan agreement. • Mortgage: A guarantee set up by the client, in response to their obligation to return a loan, which is constituted on the signing of the definitive, public Deed of Sale and its entry at the Property Registry. • Interest: The price paid for the loan. Interest is usually variable and may go up or down, depending on the performance of the official Reference Indexes. • Reference Indexes: These are the values that are used for the revision of loans with variable rates of interest. These are obtained from the mortgage or financial markets, usually from the official indexes of the Mortgage Market, which are published by the Bank of Spain in the B.O.E., like the EURIBOR. • Differential: The percentage points that are then added on to the Reference Index, to obtain the percentage to be applied to revisions of the variable interest rate. • Maximum/minimum interest rate clauses: The maximum and minimum rate of interest that can be applied to revisions of the variable interest rate, regardless of the rate that results from the application of the

2

See annex 3.

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Reference Index plus the differential. • Interest on arrears: Additional interest that is charged on unpaid quotas. This is a compensatory charge and is established on the basis of the number of days that any payment has been delayed. • A.P.R. (T.A.E.-Tasa Anual Equivalente) or Annual Percentage Rate: Effective rate of interest taking into account the rate of interest applied, the regularity with which it is paid, plus fees. • Repayment: The return of the loan, established on the basis of regular payment quotas until the full amount plus interests has been returned. • Grace period: The possibility of establishing an agreement at the start of the loan in which only interest is paid, for a fixed period. Once this period has finalised repayment of the loan will be subject to the agreed conditions. • Early repayment: The advance payment of parts of the loan, for the purpose of reducing monthly payments. This is usually subject to some kind of charge. • Fees and Commissions: Amounts that can be charged by banking entities for a range of different concepts, and which will be established in the purchase contract, such as, for example, arrangement, study, partial and full early repayment, subrogation, condition modification fees, etc. • Mortgage responsibility: This is the sum of the different amounts for all of which the mortgaged property must respond in cases of non-payment and subsequent enforcement. 2. Transparency order Order EHA/2899/2011 of 28th October on transparency and the protection of the clients of banking services obliges all credit entities to provide clients with a range of information on mortgages, as indicated in the following documents: • Pre-contractual Information Sheet (FIPRE): In order to compare offers in more detail it is advisable to request the Pre-contractual Information Sheet (FIPRE), which is shown in Appendix I of Order EHA/2899/2011, 28th October, concerning transparency and the protection of clients of banking services. This serves as a guideline, is free of charge, and the bank provides it through their communication channels. • Personalised Information Sheet (FIPRE): After providing the bank with information regarding your financing needs and financial situation, you will be handed a Personalised Information Sheet (FIPRE), on which details of the financial conditions of the loan are listed, the content of which is presented in Appendix II, of Order EHA/2899/2011 of 28th October, concerning transparency and the protection of clients of banking services. Any additional information provided by the bank will have to be indicated on the Personalised Information Sheet. • BINDING OFFER: When both parties have indicated their wish to take out the mortgage loan, after obtaining an assessment of the value of the property and carried out the necessary registry checks and, after your financial capacity has been confirmed, you are free to request a Binding Offer, which will then be examined by the Notary before completion. 3. Costs associated with a mortgage agreement For guidance purposes, these are the costs associated with a mortgage: • Prior to the signing of the mortgage agreement:

- Assessment.



- Property Register extract.

• Once the mortgage agreement has been signed:

- Legal Fees (Notary).



- Entry in the Property Register.

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- Consultant’s Office Fees // Solicitor’s Fees.



- Fire and Damages Insurance covering the mortgaged property.



- Recommended, loan repayment or life insurance.



- Stamp Duty (IAJD).



- Property Transfer Tax (ITP) or Value Added Tax (IVA), as required, for the purchase of the property itself.

As an estimation, the costs involved in a purchase and mortgage, including Property Transfer Tax or Value Added Tax, usually tend to be about 15% of the total purchase price. Whatever the case may be, as provided under Order number EHA/2899/2011, of October 28th, concerning transparency and the protection of clients of banking services, all of the information regarding the costs associated with the mortgage will be included in both the FIPRE and the FIPER, as well as in the Binding Offer. 4. Sale completion - financing centre For your convenience, as part of the Banco Sabadell Group’s centralised services, we have set up a Sales Completion-Financing Centre (CFV-F). This department is in charge of processing all the mortgages requested by individual clients in order to buy a property from our portfolio. The aim is to help to sell the available properties by reducing the period of time to process financing, once the client has given a firm promise to buy. The client must provide the documentation required for the CFV-F3 to study in the period of time to reply to the client, which is approximately 48 hours. This is a service intended to guarantee the quality of the process and a commitment to excellence. You can hand these documents over to: • the agent, • directly to your Branch or any other Sabadell Bank Branch. Once we have received the required documents and examined these, we will get back to you to inform about the progress. 5. Mortgage offer We are continually reviewing our mortgage products and their economic conditions, in order to adapt them to the mortgage market and ensure that they are always up to date. Banco Sabadell has a wide range of mortgage products for the acquisition of SOLVIA properties. Some of the main characteristics of these products are: • Financing of up to 70%, depending on the type of property. • Reference Index: EURIBOR one year interbank reference (see APPENDIX 1: HISTORICAL EVOLUTION OF THE ONE YEAR EURO INTERBANK OFFERED RATE). • Possible reductions of the interest rate, depending on associated products and services. Repayment terms of up to 30 years, with a maximum age of 75 years. Utilities in spain Electricity, gas and water connections and supplies are covered in this section. Immediately after buying a property, you should arrange for the meter to be read, the contract (e.g. electricity, gas or water) to be registered in your name and the service switched on. Make sure all bills have been paid by the previous owner. Although you’re liable only for debt incurred from the day you rent or buy a property and aren’t liable for the previous owner’s outstanding debts, utility companies sometimes cut off a supply because of a previous owner’s debts. 3

See annex 3.

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Unless you’re certain that all debts have been paid, it’s a good idea to provide your utility companies with a copy of your title deeds so that they know when you took over ownership or tenancy of the property. Registering a contract usually entails a visit to the company’s office, although many companies offer the possibility of registering online or by telephone. Note that in order to register for electricity via the internet or telephone you must give some identification (your name and your passport or identity card number), as well as the reference number for the electricity supply (usually found on the top left-hand corner of an electricity bill under Contrato de Suministro No). If you visit the utility company’s office, you must take some identification (passport or residence permit) and the contract and bills paid by the previous owner. The registration procedure for water connection is sometimes via the local town hall. Once the purchase is formalised, the estate agent may arrange for the utilities to be transferred to your name or go with you to the offices. If you’re a non-resident owner, you should also give your foreign address in case there are any problems requiring your attention, such as a bank failing to pay the bills. You may need to pay a deposit. 1. Electricity In remote areas you must install a generator if you want electricity, as there is no mains electricity, although some people make do with gas and oil lamps. In many urbanisations, water is provided by electric pump and, therefore, if your electricity supply is cut off, so is your water supply. If you buy a rural property (finca rústica), there are usually public guarantees of services such as electricity (plus water, sewage, roads, telephone, etc.). However, you may be obliged to pay for the installation of electricity lines or transformers plus the connection to your property if mains services don’t run near your home. Most modern properties (e.g. less than 20 years old) have good electrical installations. However, if you buy an old home you may be required to obtain a certificate (boletín) from a qualified electrician stating that your electricity installation meets the required safety standards, even if the previous owner already had an electricity contract. You should ensure that the electricity installations are in good condition well in advance of moving, as it can take some time to get a new meter installed or reconnected. 2. Gas In most areas of Spain, gas bottles (bombonas) are delivered to homes by Repsol Butano, for which a contract is required. You must pay a deposit of around € 25 and a replacement 12.5 kg bottle costs around € 12,50 (the price fluctuates frequently) when delivered to your home or less if purchased directly from a Butano depot. A contract is drawn up only after a safety inspection has been made of the property where the gas appliance is to be used. In some areas, you must exchange your bottles at a local supplier. You must have your gas appliances serviced and inspected at least every five years. If you have a contract with Repsol Butano, they do this for you or it’s done by your local authorised distributor. Apart from the gas bottles, Spain has an important natural gas system imported from different countries, Algeria being the main supplier, and connected to France, Portugal, Algeria and Morocco. You can ask different companies to sign an agreement to have natural gas in your home. Just ask your prospective neighbours if the gas installation has already been done. 3. Water An important task before buying a home in Spain is to investigate the reliability of the local water supply and the cost. Ask your prospective neighbours and other local residents for information. In most towns and cities, supplies are adequate, although there may be cuts in summer. It’s inadvisable to buy a property where the water supply is controlled by the developer, some of whom charge owners many times the actual cost or charge for a minimum quantity, even when they’re non-residents. In rural areas, there are often severe shortages in summer unless you have your own well.

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ANNEX 1 Historical evolution of the one-year euro interbank offered rate (euribor).

2015 January February March

euribor Oficial 0.298% 0.255% 0.212%

ANNEX 2 Monthly repayment table for each € 10,000 example of evolution of monthly repayments:

Monthly Repayment Quotas per € 10,000 Length of Repayment Term in Years Rate of interest 10

20

30

40

50

3.00%

€ 96,56

€ 55,46

€ 42,16

€ 38,49

€ 35,80

4.00%

€ 101,25

€ 60,60

€ 47,74

€ 44,28

€ 41,79

5.00%

€ 106,07

€ 66,00

€ 53,68

€ 50,47

€ 48,22

ANNEX 3 Essential documents for processing financing. Resident in Spain – employed by a third party • Application for SOLVIA Financing (with all the required information duly filled in and signed by all the parties involved). • Your last Tax Return. • Your last 2 pay slips or pension payments. • Receipts for other income (rentals, commissions, interests on bank accounts, etc…). • Your bank statement for the last 6 months from the account into which your salary/wages and other declared income is paid, along with an indication that you are the account holder. • The last 2 receipts for your regular payments with an indication of the balances pending repayment, should such be the case, (of mortgages, personal loans, financial or card credits, maintenance or alimony, rental payments, other debts, etc.). • Your up-to-date employment records. • Your Banco Sabadell current account no. (CCC/IBAN).

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Resident in Spain – self-employed • Application for SOLVIA Financing (with all the required information duly filled in and signed by all the parties involved). • Your last 2 Tax Returns and quarterly Income Tax payments for the last two years. • Your quarterly VAT payments for the present year, plus the annual summary for the previous year. • Receipts for other income (rentals, commissions, interests on bank accounts, etc.). • Your bank statement for the last 6 months from the account through which your business activity is channelled, along with an indication that you are the account holder. • The last 2 receipts for your regular payments with an indication of the balances pending repayment, should such be the case, (of mortgages, personal loans, financial or card credits, maintenance or alimony, rental payments, other debts, etc.). • Your up-to-date employment records. • Your Banco Sabadell current account no. (CCC/IBAN). Non-resident in Spain – employed by a third party • Application for SOLVIA Financing (with all the required information duly filled in and signed by all the parties involved). • Your last 2 Tax Returns from your country of residence, plus your P60, or equivalent documents, depending on country of residence. • Your last 2 pay slips or pension payments. • Receipts for other income (rentals, commissions, dividends, etc.). • Credit Report • Your bank statement for the last 6 months from the account into which your salary/wages and other declared income are paid, along with an indication that you are the account holder. • The last 2 receipts for your regular payments with an indication of the balances pending repayment, should such be the case, (of mortgages, personal loans, financial or card credits, maintenance or alimony, rental payments, other debts, etc.). • Your Banco Sabadell current account no. (CCC/IBAN). Non-resident in Spain – self-employed • Application for SOLVIA Financing (with all the required information duly filled in and signed by all the parties involved). • Your last 2 Tax Returns from your country of residence, plus your P60, or equivalent documents, depending on country of residence. • Receipts for other income (rentals, commissions, dividends, etc.). • Credit Report • Your bank statement for the last 6 months from the account through which your business activity is channelled, along with an indication that you are the account holder. • The last 2 receipts for your regular payments with an indication of the balances pending repayment, should such be the case, (of mortgages, personal loans, financial or card credits, maintenance or alimony, rental payments, other debts, etc.). • Your Banco Sabadell current account no. (CCC/IBAN).

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Buyer’s guide: how to purchase with Solvia.