Would you like to get a mortgage from a Spanish bank?
Are you interested to buy a property in Spain? Do you have difficulties to lend money from your bank in your home country? We can help you find a bank that gives you the best interest rate with english speaking staff.
I have worked at a Spanish bank for many years and I know that the process is not the same as for example in Sweden, where you get an answer whether you get the mortgage or not the same day as you apply. No, in Spain the process is a bit more tricky but far from impossible. In order to know if you get a mortgage or not, the property first needs to be valued by a company that is authorized by the bank.
Which papers do you need to present?
- The last tax declaration
- Copy of your salary slips or information about your monthly pension if you are retired. The banks normally ask for the last three salary/pension slips but they might also ask for your contract where it is written if you have a fixed contract or just temporary.
- Information about your bank accounts in your home country, such as the last statements. Any additional information is also welcome, e.g if you have shares.
- Credit information from your home country (to see if you have unpaid debts)
- Sometimes the banks will ask if you have a mortgage in your home country and how much you pay per month.
Some banks want all this information translated to Spanish by and authorized translator. It is only valid with the apostille.
How much money can I lend?
Most banks can give you between 60-70% of either the sales prices or the value of the property. The bank I worked for during many years, gave 70% to non residents. It is important to bare in mind that the banks give you 60-70% of the lowest of either the sales price or the value of the property. If the property costs 100.000 euros but the property is only valued to 80.000 euros, you can only lend 70% of the actual value (80.000).
The banks do not accept (normally) a valuation that the client present, it must be done by some of the external valuation companies that the bank has a collaboration with.
How much is the Spanish interest rate?
In Spain you use Euribor. This interest rate is today less that 0,5% but all Spanish bank use the Euribor + coefficient, for example Euribor + 2%. The banks normally have a percentage that is set by the department for residents and non residents. It can be negotiable depending on each client. The banks will always want you to buy as many products as possible, like life insurances, house insurances but it is important to know that you are not obligated to buy any of these from the bank. But, I do recommend you to have a life insurance in case something happens to you. The house insurances that are offered by the bank are to be recommended. You will always get help directly from your office in case you need to call the insurance company.
How long is the amortization period?
The amortization period depends on your age. Many banks let you lend money until you are 75 years old. In Spain it is a must to pay off the loan and the period does depend on your age. If you are around 40 years old, you have the possibility to get a payment plan for 30-35 years.
Most banks today have at least someone that speaks English at the office, especially if the bank is located in an area with a lot of tourists. If you live near Alfaz del Pi, Albir and La Nucia most banks have Scandinavian personnel that also speak English fluently. If you buy a property from a bank, I would recommend to open an account in that bank and apply for a mortgage at that bank. The interest rate is normally very good if the bank repossession comes from that bank.
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