 We at
Spectra Properties
have the facilities to be able to offer
mortgages through the Spanish Unicaja Bank
and through the Spanish CajaMar, offering a complete service.
For more information about the terms and
conditions of this service, please do not
hesitate to contact us.
Mortgages (Hipotecas) or home loans
are available from all Spanish banks (both
for residents and non-residents), foreign
banks in Spain and Offshore Banks.
Interest rates have been high in Spain for
some years, although they have fallen
considerably in many years. Spanish
mortgages usually have a variable rather
than a fixed interest rate and have
traditionally been at 3 to 4 per cent above
base rate. However, low interest mortgages
have been introduced in recent years by a
number of Spanish banks including Unicaja,
BBV and Argentaria, undercutting the
official central bank lending rate. Note
that a low interest rate (which usually
increases after one year) may be more than
offset by increased commission charges.
In Spain, its customary for a property to be
held as security for the loan, i.e. the
lender takes a charge on the property, which
is recorded at the property registry. If a
loan is obtained using a Spanish property as
security, additional fees and registration
costs are payable to the Notary (Notario)
for registering the charge against the
property. To obtain a mortgage from a
Spanish bank, you must provide proof of your
monthly income and all outgoings, such as
mortgage payments, rent and other loans or
commitments. If you want a Spanish mortgage
to buy a property for commercial purposes,
you must provide a detailed business plan
(in Spanish). Note that a mortgage can be
passed to the new owner when a property is
sold.
Mortgages are granted on a percentage of a
valuation, which itself is below market
value. The maximum mortgage in Spain is
usually around 70-80 per cent of the
purchase price, although loans of 50-60 per
cent of the property valuation are more
usual, particularly for non-residents. The
normal term is 10-15 years, although
mortgages can be repaid over five to twenty
years. The repayment period may be shorter
for non-residents. Repayment mortgages are
the most common type in Spain, although
endowment and pension-linked are also
available. Repayments can usually be made
monthly or quarterly.
Note that you must add expenses and fees (see
"The fees involved in
buying a property"), totalling
around 10 per cent of the purchase price, to
the cost of a property. For example, if you
are buying a property for 60.101 EUROS
and obtain a 70 per cent mortgage, you must
pay 30 per cent deposit (18.030 EUROS)
plus 10 per cent fees (6.010 EUROS)
making a total of 24.040 EUROS. There are various fees associated with
mortgages, e.g. all lenders charge an "arrangement"
fee (comision de apertura) of 1-2 per
cent which is usually a minimum of 300 - 450
EUROS.
Although it is unusual to have a survey in
Spain, foreign lenders usually insist on a "valuation
survey" (usually costing approx 300 EUROS)
for all Spanish properties, before they will
grant a loan.
If you intend to obtain a mortgage in Spain,
you should allow at least 3-4 weeks for it
to be finalised. If you are a Spanish tax
payer (resident), you can claim an allowance
for your Spanish mortgage against your tax
liabilities.
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