Using a Lawyer • Rent to Buy • Renting
Getting a Mortgage in Spain
Below are some frequently asked questions about mortgages in Spain, kindly supplied by Atkinson Spanish Mortgages.
How much can I borrow?
Lending in Spain is based on the valuation of the property. For urban properties, 70% - 80% can be achieved although for ‘rustic’ property only 50% is available.
What types of mortgages are there?
Almost all mortgages are capital repayment and some include an interest only term. Fixed rates do exist but the interest rates are expensive.
What is the interest rate?
The interest rate in Spain is called EURIBOR. This is based on the European Central Bank base rate and changes every month. 4.50% is a good indicator of the rate available to non residents. Compared with current base rates in the UK, your repayments are more affordable. Click here to calculate possible mortgage repayments.
How to I repay the mortgage?
We can refer you to a commercial exchange company who can arrange a fixed rate for monthly repayments so the sterling you pay for your mortgage remains the same regardless of exchange rate fluctuation.
How long does it take to complete?
From deciding on the property you want and paying the reservation deposit to completion is usually 6 weeks if you need a mortgage. Without a mortgage it is usually 4 weeks. This extra time is needed to receive your income documents and to instruct and obtain the valuation.
How much is it going to cost me?
In general terms, if you are purchasing without a mortgage you will need to pay 10% of the purchase price in taxed charges and fees. If you are buying with a mortgage you will need to pay up to 13%. The fees are listed below:
Purchase costs:
- 7% IVA (VAT)
- 1% Stamp duty
- 1% Legal fees (there may be a minimum to pay)
- Notary fees
- Mortgage costs
- 1% Stamp duty (1% of mortgage value + 1% of total accrued interest)
- Valuation fee
- Notary fee
- Arrangement fee
Do I need a Spanish lawyer?
Getting an English speaking Spanish lawyer is of paramount importance. The lawyer will check to make sure the property is legal and that the debts, if any, registered to the property are being cleared from the sale proceeds. He or she also controls the flow of money through client accounts, organizes the connection of services, and if they have power of attorney, can sign at the notary to complete on your behalf. If you would like us to recommend an independent English speaking Spanish lawyer, we will be happy to oblige.