Mortgages |
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If you are considering buying a house in Spain because you live and work here, or because you simply want to invest in real estate in Spain, you may want to consider taking out a mortgage with a Spanish bank. Whether you want to buy a finca in Spain, a holiday apartment on the Costa Calida or a new home in Spain, taking out a Spanish mortgage may be the right solution for you. Please note - We are not licensed credit brokers & can not be held liable for the actions of others. All we can do is introduce you to other companies but we are not no way related in a business partnership sense. Interest rates in Spain vary, but are generally much lower than in the UK, and competition between Spanish banks is fierce. If you are interested in a property still to be built, you may find that the constructers already have an agreement with a certain Spanish bank for all mortgages and you are left with little choice. If not, you would be wise to shop around for the best deal. Don't accept the first offer Ask for a copy of one bank's offer and then take it to a different bank to see if they can improve the offer - they often will. Then take the improved offer back to the original bank - you may get a pleasant surprise!! Proof of Income You will be expected to prove ability to pay (i.e. wage slips from the last 3 months and bank statements of the last 6 months or, if you are self-employed, copies of your last 3 years accounts (with an auditor's stamp) and copies of you last 12 month's business bank statements and your last 6 months personal bank statements). Proof of payment based on your ability to pay with income received from renting the property will not be taken into account by Spanish banks. See our full list documents necessary to apply for a mortgage with a Spanish bank for residents and non-residents. What Else Do I Need? If you are not a legal resident in this country, then you may be asked to provide an aval. This will be somebody usually based in Spain who agrees to pay in the event of you being unable to. You will also be required to have a NIE (Numero de Identificación para Extranjeros) which is like an ID number everyone needs (residents and non-residents) in order to buy or sell property in Spain. How Much can I Borrow? As a none-resident you will only be able to borrow a maximum of 70 – 80% of the value of the property using a Spanish Mortgage. The significant fact here is that the banks do not use the same credit search references as the banks do in Spain and so it is very often considerably easier to raise mortgage finance in Spain. Another important fact to consider is that you are allowed to raise a mortgage against the valuation of the property when it is completed and not in accordance with the contract price. As you will appreciate, any increase in value in the property between the date of the contract and completion could have a significant effect on the amount that you are allowed to finance under a mortgage. Indeed, you may find it possible to pay off any finance that you used to fund the stage payments or, if you used cash, to take this cash out of the property and buy another one. |
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