The Contrato de Arras is one of the most important legal documents in the Spanish property buying process. If you’re purchasing real estate in Madrid as a foreigner, you need to understand how this agreement works — and the risks if it’s not properly reviewed.
At Borderless Lawyers, we help foreign buyers draft and negotiate arras contracts to ensure full legal protection.
❓ What Is the Contrato de Arras?
The Contrato de Arras is a private deposit agreement between buyer and seller, typically signed after the reservation stage and before the public deed.
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You pay a 10% deposit
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Both parties commit to completing the sale
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Penalties apply if either party backs out
It’s legally binding under Spanish civil law (Art. 1454 of the Civil Code).
🛑 Why It’s Risky to Sign Without a Lawyer
The arras contract:
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Locks you into the deal
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Often uses templates from the agent
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May include clauses that favor the seller
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Can cost you your deposit if you’re not careful
We’ve seen buyers lose thousands due to unfair or vague clauses.
🔒 What Protections Should Be Included?
At Borderless Lawyers, we ensure the contract includes:
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Clear deadline for signing the public deed
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Clauses for what happens if the seller has legal issues
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Conditions tied to mortgage approval (if applicable)
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A refund clause if legal due diligence fails
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Proper identification of the property and seller
We customize every contract based on your situation.
💸 What Happens If Someone Backs Out?
| If the buyer withdraws | You lose the deposit (€)
| If the seller withdraws | Must return double the deposit (€€)
| If a legal issue blocks the sale | Depends on the clauses written
➡️ That’s why the right legal wording is essential.
🧾 Is It Required by Law?
No — but in Madrid’s property market, it’s a standard legal step. Sellers expect it. Not signing arras often means losing the property to another buyer.
⚠️ It’s not the same as a “reservation contract” — that’s less binding and usually drafted by agents.
📅 When Is It Signed?
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After reservation and once due diligence begins
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Before signing the deed (Escritura Pública)
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Usually 30 to 60 days before the final notary appointment
💶 Typical Terms in Madrid
| Clause | Typical Range |
|---|---|
| Deposit | 10% of purchase price |
| Completion deadline | 30–60 days |
| Penalty if buyer defaults | Loss of deposit |
| Penalty if seller defaults | Return x2 the deposit |
We negotiate flexible deadlines and conditions for our clients to avoid pressure or surprises.
💬 Final Word
The Contrato de Arras is more than a deposit — it’s a binding agreement that can cost or save you thousands. Never sign it without a proper legal review.
At Borderless Lawyers, we:
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Draft customized arras contracts
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Negotiate fair terms in your interest
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Translate and explain everything clearly
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Protect your rights as a foreign buyer in Madrid
📞 Contact us today before you sign any arras agreement in Spain.