Getting a mortgage in Spain maybe an important part of buying a home in Spain, despite the fact that it could be very different form the mortgage system in your country, it is not a complicated process at all if you have the right information and you hire the right help.
If you are seriously considering buying a house in Spain it may be a good idea if you start researching and arranging a mortgage loan at the same as you are looking for a house. In fact it is a great idea if you have a mortgage figure out before starting the purchase process, that way you may be able to save you some money and some pressure.
Mortgage and Purchase Process
Finding a mortgage at the same time you are searching for your home certainly has advantages. First at all you will know exactly how much you can spend on a property, have in mind that standard loans values are up to 70% for non-resident and up to 80% for residents.
Finding a mortgage before buying the property also allows you to find the best option for you, in terms of the interest rate, the length of the loan and of course you can find out all the financial implications of your purchase.
It is vital to understand that Mortgages in Spain are based on the Euribor values. This is basically the Euro system interbank lending rate set by the European Central Bank (ECB). Euribor is the interest rate mostly commonly used to calculate mortgage payments in Spain. Every 12 months your mortgage interest rate will be revised and adjust.
Mortgage terms range from 5 to 40 years and they depend on factors as age and Spanish finance provider selected. Some offshore banks can provide mortgages in sterling secured against your Spanish property purchase, linked to the Bank of England base rate. Now days there is attend to offer access to only terms and fixed rates. However the fixed rates tend to be slightly higher than the prevailing variable rate.
Criteria and Using Help
Most Spanish banks will consider your income net of tax and they will want to see that the combine existing liabilities combined with the new acquired ones in Spain won’t exceed 1/3 of your proven monthly net income. Some banks may be able to extend that to a 45% of the net income, but each bank can be slightly different.
It is highly recommended to hire a mortgage broker, unless you already have a relationship with an Spanish bank. An experience broker will know already which banks offer the best rates and the best terms and they will be able to find the perfect product for your needs. They will charge a fee but on the long term they will save you more money of whatever they charge. Before hiring a broker do your homework and make sure the broker is experience and has a good knowledge of the process.
In ForSaleInSpain we are professional dedicated to help you through the process of buying your dream home in Spain. Contact us!