Bank guarantees for Spanish new-build property: what to check before paying an advance

Before making an advance payment on a Spanish new-build home, compare the actual guarantee, beneficiary, covered amount and payment account with the contract. The word “bank guarantee” in a development brochure is insufficient. Request the documents for your own transaction and have an independent Spanish lawyer check the payment conditions.

This guide concerns advance payments for homes bought from a developer off-plan or during construction. Matching documents matters just as much for an apartment in Estepona, Mijas or Marbella. Our Spanish property buying guide explains the full sequence; here we focus on the checks before transferring money.

What does the bank guarantee or insurance protect?

Under the first additional provision of Spain's Ley 38/1999, from the point at which the building licence is obtained, the developer must protect repayment of advances through a bank guarantee or appropriate insurance if construction does not start or is not completed within the agreed delivery period. Cover includes applicable taxes and statutory interest. Source: BOE, the Building Act's advance-payment provision.

Spanish documents usually call the bank guarantee an aval bancario and the insurance solution a seguro de caución. These advance-payment protections address a different issue from repairing defects in a completed home. For technical checks, use our new-build property handover guide.

The current text of this national advance-payment provision has applied since 1 January 2016; sources were checked on 10 October 2026. We identify the additional Andalusian document rules separately below. Protection does not make the transaction risk-free or provide an unrestricted right to withdraw simply because a buyer changes their mind.

Why does a reservation before the licence need separate attention?

Banco de España also identifies obtaining the building licence as the point when the guarantee obligation begins. Do not automatically assume that a reservation amount requested before the licence already benefits from the same statutory protection. Source: Banco de España, guarantees when buying a home.

Even before a smaller reservation payment, clarify who receives the money, on what basis, whether it counts towards the purchase price and the conditions for repayment. The labels “reserva”, “señal” or “arras” do not replace interpretation of the agreement. Hungarian buyers should not automatically transfer the familiar consequences of a Hungarian “foglaló” to a Spanish contract.

If the licence is still pending, ask your lawyer for a written assessment of the payment's actual protection and refund conditions. Do not treat a promise of “a guarantee later” as evidence of cover for money being transferred now. Any alternative arrangement must also be assessed against its actual terms.

Match six details before every instalment

The table below is a practical checklist, not a guarantee-document template. Read the contract, payment schedule and evidence of cover side by side, and resolve discrepancies before paying.

When the purchase contract is entered into, the developer must deliver a document evidencing the guarantee individually relating to the advances. For insurance, the law requires a policy for each buyer identifying the property. Source: BOE, first additional provision, Dos and Tres.

As a practical objective, request a document pack allowing your lawyer to check protection for your own payments. If you receive only a development-wide framework document, request the individual evidence too. For money already paid, do not independently draw a legal conclusion from a missing document: take the complete file to a lawyer.

Check the special account too

The law requires advances to be placed in a cuenta especial, separated from the developer's other funds and usable for expenditure connected with constructing the homes. Source: BOE, first additional provision, Uno.

Matching the bank name, IBAN and payee is a separate check. An account at a familiar bank does not by itself establish which advance-payment protection document relates to it. Examine the account and guarantee together.

If a new account number arrives by email or message before a transfer, confirm the change through previously verified contact details. Do not use the telephone number in the account-change message as your only verification channel. Keep the confirmation and bank receipt alongside the contract.

In Andalusia, request the DIA as well

Under the Costa del Sol's Andalusian consumer-information rules, a consumer requesting information about a planned or under-construction home must receive a free Documento Informativo Abreviado, or DIA. It identifies the guarantee provider and special account for advances; the building-licence position is also included. Source: Junta de Andalucía, Decree 218/2005, Article 6.

Compare the DIA with the reservation and purchase documents. A development's sales page is a useful starting point, but verify licence and cover status against the selected apartment's documents. In another Spanish region, establish which local information requirements apply.

Illustrative example: how should you track payments?

Assume an invented development already has its building licence and the contract treats a €5,000 reservation, a later €35,000 payment and then €40,000 as purchase-price advances. The example assumes these figures already include the tax on each instalment. Total payments are therefore €5,000 + €35,000 + €40,000 = €80,000; statutory interest must be handled separately.

This is not a current offer, recommended payment schedule or universal reservation amount. In your own spreadsheet, record each payment's date, amount, account, bank receipt and related guarantee-document reference. Before the next instalment, have your lawyer check how the documentation covers the contractual advances.

Adding up €80,000 does not by itself establish that the insurance or bank guarantee is adequate. If, for example, you can find evidence relating to only €40,000, treat this as a document-reconciliation question; do not decide independently that the remainder is definitely protected or definitely lost. Our costs and taxes guide helps you plan other purchase expenses separately.

What should happen if delivery is delayed?

First review the contractual date, agreed extensions and actual position with your lawyer. If you are asked to accept a new delivery date, have the alignment between the contract and the duration of cover checked too. Keep properly organised documentation of the change rather than relying on informal messages.

Banco de España explains that enforcing a guarantee may involve a provable repayment demand to the developer, followed by approaching the bank after an unsuccessful 30-day period. Bank guarantees also have a two-year expiry rule from breach of the guaranteed obligation if the buyer has not requested termination of the contract and repayment of advances. This is not a general deadline for every claim. Source: Banco de España, guarantees when buying a home.

A Spanish lawyer should establish the specific demand, recipient and deadline; if there is delay, do not postpone organising the correspondence. The possibility of repayment does not mean money arrives immediately after a complaint. Plan legal and financial reserves with that in mind.

What should you check immediately before transferring money?

Identified home and buyers, verified licence position, individual guarantee evidence, clear amounts and account, and retainable receipts. For every instalment, establish what has changed since the previous payment. Resolve open questions before paying, and do not substitute a marketing statement for professional review.

If you are looking for a Costa del Sol new-build home, tell us your planned timing and payment budget during a SpainProperty consultation. Have your own Spanish lawyer separately examine the selected development's advance-payment protection and contract.